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Talking Points:
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AUD/USD Technical Strategy: Flat
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Support:0.8479 0.8377 0.8251
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Resistance:0.8581 0.8659 0.8772
The Australian Dollar may be preparing to turn higher against its US counterpart following the appearance of a Bullish Engulfing candlestick pattern. A daily close above support-turned-resistance marked by the January 2014 lowat 0.8659 exposes the 23.6% Fibonacci retracement at 0.8743. Alternatively a reversal below the 50% Fib expansion at 0.8531 opens the door for a challenge of the 61.8% threshold at 0.8441.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak Currency Strategist for DailyFX.com
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