AUD/USD Testing Upper Border of Triangle Range

AUD/USD (daily chart as of June 11, 2014) found support at the 200-day EMA again on June 2 (green arrow on chart). Currently, it has climbed to test the upper border of the triangle–like range between the short-term downtrend line (line 3) and the 200-day EMA (or line 4), as mentioned in our June 2 analysis.

Price broke out above line 3 yesterday with a relatively weak bullish candlestick, but managed to close above the trend line. Note that we require strong price action with follow-through to confirm any major breakouts.

The pair has been trading above the 200-day EMA since March 26 (gray shadow on chart). It is now the pair’s second breakout above the long-term moving average since the downtrend started in April 2013. The first attempt occurred on October 17, 2013 (red shadow).

The Australian Bureau of Statistics will release the Employment Change data later today, as well as the Unemployment Rate that is expected to have reached 5.9% in May from 5.8% in April.

Support levels below:
1st support: 200-day EMA
2nd support: 0.9085 (January 13 high)
3rd support: 0.8890 (multiple highs and lows)

Resistance levels above:
1st resistance: short-term downtrend line 3
2nd resistance: 0.9460 (April 10 high)
3rd resistance: 0.9540 (November 6, 2013 high)