EXPECT RALLIES TO STALL OUT AHEAD OF 2009 HIGHS; LOOK TO SELL
Aud/Usd: The market has taken to selling USDs one again, with the Aussie surging overnight to trade back above previous trend-line support into the 0.8100’s. However, we view the break of the multi-day trend-line support in the previous week as net bearish, with any rallies back above this trend-line seen limited. The 78.6% fib retracement off of the 0.8265-0.7825 move comes in at 0.8170 and also directly coincides with Wednesday’s projected daily ATR (Average True Range) high. As such, we will look for opportunities to sell into this level, in anticipation of a lower top below the 0.8265 2009 lows, and ahead of a fresh downside extension to be confirmed on a break back under 0.7825. Strategy: SELL @0.8165 FOR AN OPEN OBJECTIVE, STOP @0.8315. Recommendation to be removed if not triggered by NY close (5pm ET) on Wednesday.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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