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Talking Points:
- AUD/USD Technical Strategy: Flat
- Support:0.8659, 0.8568, 0.8466
- Resistance:0.8887, 0.8971, 0.9073
The Australian Dollar may be readying to renew its downward push against its US counterpart after prices put in a Bearish Engulfing candlestick pattern. A daily close below the intersection of a rising trend line and the 14.6% Fibonacci expansion at 0.8784 exposes the 23.6% level at 0.8706.Alternatively, a reversal above support-turned-resistance at 0.8887, the March 2014 low, opens the door for a challenge of the 38.2% Fib retracement at 0.8971.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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