Australian Dollar Testing Resistance Line

Commentary: The short term pattern is not clear so we are focusing on the longer term chart right now. The impulse rally that followed the break of the triangle began in June 2006. Impulse rallies will either unfold in 5, 9, or 13 waves (these are all derivations of 5 waves - 9 would indicate an extended wave - 13 would indicate 2 extended waves, etc).

So far, there are just 7 waves. This means that we are looking for a corrective down leg to be followed by a rally to a new high. When the down leg will begin is anyone?s guess. The best opportunity in the AUDUSD in the next few weeks will be to wait for the corrective decline to unfold before getting bullish for a run at a new high. Strategy: Flat