AUD/USD (daily chart as of March 10, 2014) broke out above a short-term
downtrend line on March 6 and touched a high of 0.9130 on March 7, but failed to
hold it by closing lower at 0.9060, below the key resistance of 0.9085. This is
the first time that the pair has traded through above 0.9085 in about three
months since early December 2013.
Possible trading setups could be placed based on the price action against 0.9085. If the pair is unable to clear the 0.9085 mark, it could fall to test the daily EMA 50 again and the short-term uptrend line connecting the January 24 low and the March 2 low. Note that current price has been making higher highs and lows since January 24. As long as it can hold the short-term uptrend, further upside movement should be expected.
Note also that current price is approaching its medium-term downtrend line connecting the April and October 2013 highs, and is also approaching the multiple highs of 0.9170. The pair is under pressure below those resistance levels amid China’s biggest trade deficit in two years, as well as Chinese yuan reference rate lowered by 0.18%, the most in one-and-a-half years.
Support levels below:
1st support: the short-term uptrend line
2nd support: 0.8890 (March 2 low)
3rd support: 0.8825 (January 28 high)
Resistance levels above:
1st resistance: 0.9085 (key resistance level)
2nd resistance: 0.9170 or medium-term downtrend line
3rd resistance: 0.9270 (multiple lows)
Possible trading setups could be placed based on the price action against 0.9085. If the pair is unable to clear the 0.9085 mark, it could fall to test the daily EMA 50 again and the short-term uptrend line connecting the January 24 low and the March 2 low. Note that current price has been making higher highs and lows since January 24. As long as it can hold the short-term uptrend, further upside movement should be expected.
Note also that current price is approaching its medium-term downtrend line connecting the April and October 2013 highs, and is also approaching the multiple highs of 0.9170. The pair is under pressure below those resistance levels amid China’s biggest trade deficit in two years, as well as Chinese yuan reference rate lowered by 0.18%, the most in one-and-a-half years.
Support levels below:
1st support: the short-term uptrend line
2nd support: 0.8890 (March 2 low)
3rd support: 0.8825 (January 28 high)
Resistance levels above:
1st resistance: 0.9085 (key resistance level)
2nd resistance: 0.9170 or medium-term downtrend line
3rd resistance: 0.9270 (multiple lows)
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