AUD/USD Technical Analysis: Coiling Up for a Breakout?
To receive Ilya's analysis directly via email, please SIGN UP HERE
- AUD/USD Technical Strategy: Flat
- Aussie Dollar continues to mark time within a narrowing range
- Waiting for clear-cut direction cues to establish open exposure
The Australian Dollar may be coiling up for a breakout against its US namesake as prices oscillate in an increasingly narrow range below the 0.78 figure. Sideways consolidation often precedes continuation, implying a bearish bias considering the standstill is occurring within the context of a multi-year down trend.
Trend line support comes in at 0.7575, with a break below that on a daily closing basis broadly exposing a double bottom at 0.7443. Alternatively, a push above downward-sloping resistance at 0.7711 paves the way for a challenge of the August 11 high at 0.7760.
On one hand, prices are too close to near-term resistance to justify a long position from a risk/reward perspective. On the other, the absence of a clearly defined bearish reversal signal warns that it is premature to take up the short side. Remaining on the sidelines seems most prudent for now.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.