AUD/USD Technical Analysis: Aiming Below 0.70 After Support Break
AUD/USD Technical Strategy: NET SHORT AT 0.7456
- Australian Dollar resumes downtrend after test of 2018 resistance
- Prices now aiming below 0.70 figure after break of September low
- Added further to short AUD/USD exposure just above 0.72 mark
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The Australian Dollar resumed the down move against its US counterpart as expected after a short-lived upswing stalled at trend resistance set from January. A break below September’s swing bottom at 0.7085 opens the door for deeper losses.
The next layer of support lines up at 0.6914, the 38.2% Fibonacci expansion, followed by the 0.6790-0.6827 zone (50% level, January 2016 low). Alternatively, a move back above 0.7085 – now recast as resistance – may precede another test of the trend ceiling, now in the 0.7175-0.7248 area.
Additional exposure was added to the short AUD/USD trade triggered at 0.7608 and subsequently scaled up, first near 0.7530 and then again at 0.7325. The latest piece was activated at 0.7205, putting the overall cost basis at 0.7456. A discretionary approach will be taken to activating a stop-loss.
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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.