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Talking Points
- AUD/USD Technical Strategy: Shorts preferred on bounce
- Bullish engulfing pattern hinting at a short-term recovery
- Downtrend intact on daily supports overall bearish bias
The Bearish Engulfing pattern noted in the last AUD/USD candlesticks report has resulted in continued declines for the pair. The bulls appear to be prepared to offer support at 0.8890 in intraday trade with a Bullish Engulfing pattern on the hourly hinting at a short-term bounce.
However given a downtrend on the daily timeframe, a strengthening of the Aussie would be seen as an opportunity to enter new short positions. The 23.6% Fib Retracement level pictured below is likely to offer some resistance.
It is also noteworthy that the upcoming RBA rate decision is likely to create intraday volatility for the AUD/USD. You can check the calendar here to view upcoming event risk for the week.
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Hourly Chart – Created Using FXCM Marketscope 2.0
— Written by David de Ferranti, Market Analyst, FXCM
Contact and follow David on Twitter: @Davidde
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