AUS 200 Technical Analysis: Rebounds into Triple Bottom Area
- AUS 200 Strategy: Range trade as rebound carries on
- Upward momentum persists, resistance is 4998 if index passes through triple bottom area
- Immediate support is 4859.9, followed by firm support / lower bound of range at 4754
AUS 200 returned to areaabove previous 4859.9 support level as we expected, as part of a retracement after the crash last Friday. Sustained price action in triple bottom area 4859.9-4918.4 may lead to higher extensions toward 4998 resistance level.
Upward momentum signals persevered so far this week, resulted in short-term bias. However the index remains largely in a range of 4754-4998.9. Downtrend signal has not abated in moving averages, thus downward pressure is inherent.
Range traders who bought the dip could look to target ahead of resistance level, to be adjusted in case the rebound intensifies following a breakout at top. Long-term trend is still absent in the index.
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--- Written by Nathalie Huynh, Strategist for DailyFX.com
Contact and follow Nathalie on Twitter: @nathuynh