AUD/USD continues slide from head-and-shoulders pattern
James Chen November 13, 2013 3:58 PM
<p>AUD/USD (daily chart) has continued its breakdown below both a bearish head-and-shoulders reversal pattern and the key 0.9400 support level. This follows a previous inverted […]</p>
AUD/USD (daily chart) has continued its breakdown below both a bearish head-and-shoulders reversal pattern and the key 0.9400 support level. This follows a previous inverted (bullish) head-and-shoulders pattern in July, August and September, which reversed the long slide from April to August. The price target for that pattern, around the 0.9600 level, was reached in mid-October.
For the current bearish head-and-shoulders pattern, which has its head right around the 50% retracement of the noted April-August slide, the neckline was broken late last week along with a breakdown below the 50-day moving average and the key 0.9400 support level.
This week, the pair has continued its slide and has just tentatively broken down below 0.9300-area support. Continued downside momentum could push the pair towards its head-and-shoulders target, around the 0.9060 level, which is just above the major psychological support level of 0.9000.
Upside resistance now resides around the prior 0.9400 support level.
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