AUD/USD Technical Analysis: Looking to Sell Aussie Near Trend Top
AUD/USD Technical Strategy: NET SHORT AT 0.7547
- Australian Dollar back at seven-month downtrend resistance
- Recent upswing may offer opening to add to AUD/USD short
- Looking for confirmation on a break of counter-trend support
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The Australian Dollar is back at resistance defining the downtrend against its US counterpart since late January. Its outer layer – now at 0.7391 – is reinforced by former support marking the bottom of a consolidation range in force before the latest attempt at bearish resumption. A daily close above that exposes the 0.7452-61 area. Immediate support is at 0.7238, the August 15 close, with a break below that targeting the double bottom in the 0.7145-65 zone.
The AUD/USD short position initiated at 0.7608 and subsequently scaled up near 0.7530 continues to be active. The dominant trend continues to look bearish, suggesting recent gains amount to an opportunity to add exposure rather than a reason to abandon it (at least for now). Confirmation signaling sellers have retaken the initiative is needed however. Zooming in to the 4-hour chart, a break below counter-trend support set from the August 24 swing might serve as a trigger, provided risk/reward parameters are acceptable.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.