AUD/USD breaks four-year low
James Chen November 26, 2014 7:04 PM
<p>AUD/USD (daily chart shown below) broke down below the most recent significant low of 0.8540 which was established in early November, hitting a new four-year […]</p>
AUD/USD (daily chart shown below) broke down below the most recent significant low of 0.8540 which was established in early November, hitting a new four-year low for the currency pair.
Since early September, AUD/USD has been trading within a strong bearish trend, particularly during September’s month-long plunge. After that precipitous drop, price action began moving in more of a consolidation during the month of October, but with continued downside pressure.
Early November saw a swift breakdown below a conspicuous inverted pennant pattern, which went on to hit and dip below the 0.8600 downside support target before establishing a new four-year low around the noted 0.8540 level.
The rebound from that low rose to a high around 0.8795 early last week, slightly above the key 50-day moving average, before dropping back down once again towards its lows.
Currently, having broken down below the 0.8540 level and established a new multi-year low below 0.8500, a continuation of the long-term downtrend for AUD/USD has tentatively been confirmed.
With any further bearish momentum below the 0.8500 level within the current downtrend, the next major downside support target resides around the 0.8300 level, last hit in mid-2010.
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