AUD/USD Testing the Key 0.9000 Mark

AUD/USD (daily chart as of September 3, 2013) bounced off 0.8890 on August 30 and positioned to test 0.9000, which is a psychologically significant level, the low of July 12, and also around the current daily EMA 20. The currency pair has been trading in a complex manner since June 20, consolidating the steep downtrend that started back to April. Price needs to hold 0.8850 and stay above the EMA 20 or 0.9000 to make a potential near-term reversal pattern possible.

Watch closely the price action against the EMA 20. We had two choppy tests of that line previously (the pink and silver rectangle shapes on the chart). If price can clear the EMA 20, the next resistance would be the EMA 50, followed by 0.9230 or the downtrend resistance line (upper blue bold line). Note that the daily MACD is turning up from just below an uptrend line. The daily RSI is turning up to test the line 2 resistance and is approaching 50, which has been serving as strong resistance for about two months.