Aussie Breakdown Offers Selling Opportunities
AUDUSD – Forex trading crowds have bought aggressively into Australian Dollar weakness, and a contrarian view of crowd sentiment leaves us in favor of further declines. A close below key congestion support at $1.04 would serve as confirmation of a major break lower.
Trade Implications – AUDUSD: Our sentiment-based trading strategies have sold the Australian Dollar versus the US Dollar and Japanese Yen, but AUDUSD consolidation above $1.0400 has limited our enthusiasm for such AUD-bearish positions. We may need to see a substantive break lower to get aggressively short AUDUSD.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.