AUD/USD attempts further rise from lows

<p>AUD/USD (daily chart shown below) has continued its attempts to reach higher in a push to extend the rebound from extreme lows that has been […]</p>

AUD/USD (daily chart shown below) has continued its attempts to reach higher in a push to extend the rebound from extreme lows that has been in place for more than three months.

After hitting a three-and-a-half year low of 0.8659 in late January, the currency pair began a steady climb that formed both a bullish head-and-shoulders reversal pattern as well as an ascending trend line connecting price lows.

In late March, price action broke out above a confluence of resistance that included: the neckline of the noted head-and-shoulders pattern; a downtrend line extending back to April of 2013; and the 200-day moving average.


AUD/USD chart - 14.05.14


Bullish momentum followed-through to hit a high of 0.9460 before pulling back to the rising trend line.

AUD/USD then rebounded off both this trend line and its closely-adhering 50-day moving average, bringing the pair back up to trade around the 0.9400 level.

Currently trading just under April’s 0.9460 high, AUD/USD continues to carry a bullish bias within a strong rebound.

Key downside support currently resides around the 0.9200 level, the area of the last pullback.

The primary upside target remains around the 0.9600 level, which is both the technical pattern target for the noted head-and-shoulders pattern as well as the 50% Fibonacci retracement of the previous major downtrend.


Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.