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Talking Points:
- AUD/USD Technical Strategy: Flat
- Aussie Dollar struggles to hold above 0.76 vs. US counterpart
- Bearish reversal may be brewing but confirmation is still absent
The Australian Dollar spiked to the highest level in nearly three months against its US counterpart but prices are struggling to maintain a foothold above the 0.76 figure. In fact, the currency is having a hard time sustaining momentum even with a tailwind of supportive economic data,
From here, a daily close above the 0.7609-24 area (inflection point, 50% Fibonacci expansion) paves the way for a challenge of the 61.8% level at 0.7693. Alternatively, a move back below the 38.2% Fib at 0.7554 exposes resistance-turned-support at 0.7517 (May 23 high), followed by 0.7468 (23.6% expansion).
The Aussie’s inability to build higher even as fundamental news-flow offers up a seemingly straight-forward catalyst for gains may hint at significant underlying weakness, opening the door for a reversal lower. An actionable setup is absent for now however, and opting for the sidelines seems most prudent.
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