Talking Points:
- AUS 200 Strategy: Prepare to exit if resistance at 5074 holds through next week
- Momentum is poised to reverse down
- Whereas a breach would bring it back into last year’s range
The 5074 resistance level will be a tough one to break for AUS 200 on its way back up to the August-January range of 4198-5391. A pause in upward momentum signals also hints at restrained advancement ahead.
Traders with long positions should be prepared for a possible reversal at this resistance, especially if momentum continues to fade below the upper boundary. A close approach to resistance (and failure to breach) before this weekend could provide some good opportunities to range traders who are in waiting.
5074 is a critical level for next week’s development. At a breach, the way above head is fairly clear unto top of the range and 50% Fibonacci at 5391.5.
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Daily Chart - Created Using FXCM Marketscope
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--- Written by Nathalie Huynh, Strategist for DailyFX.com
Contact and follow Nathalie on Twitter: @nathuynh
