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Forex: AUD/USD Technical Analysis – Stop Hit on Short Position

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Talking Points:

Our short AUD/USD position was narrowly stopped outon a daily close above 0.9085, the January 13 high. This barrier is reinforced by the 50% Fibonacci expansion at 0.9098. A break above the latter barrier exposes the 61.8% level at 0.9147. Alternatively, a reversal below the 38.2% Fib at 0.9048 aims for the 23.6% expansion at 0.8987.

Prices are too close to relevant resistance at this point to justify a long position on risk/reward grounds. On the other hand, attempting to re-enter short without a defined downward reversal signal seems premature. We will stand aside for now and monitor the pair for new entry opportunities.

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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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