AUD/USD Technical Analysis: Short Trade Triggered Above 0.75
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- AUD/USD Technical Strategy: Short at 0.7526
- Aussie Dollar drops below monthly support vs. US namesake
- Short position triggered,initially targeting below 0.74 figure
The Australian Dollar moved lower against its US namesake as expected, taking out support guiding prices higher over the past month. From here, sellers look poised to challenge the uptrend floor established from major swing lows at the start of the year.
A break below 0.7381, the intersection of trend line support and the 38.2% Fibonacci retracement, opens the door for at test of the 50% level at 0.7275. Alternatively, a daily close back above support-turned-resistance at 0.7538 paves the way to challenge the 0.76 figure, followed by the March 31 high at 0.7723.
Technical positioning hints the long-term AUD/USD down trend may be resuming, in line with our 2016 fundamental outlook. Risk/reward considerations also appear acceptable and we have entered short at 0.7526, initially targeting 0.7381. A stop-loss will be activated on a daily close above the 0.76 figure. We will take profit on half of the position and move the stop to breakeven once the first objective is reached.
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