AUD/USD drops further to six-month low
James Chen September 18, 2014 7:07 PM
<p>AUD/USD (daily chart shown below) has tentatively dropped below key support around the 0.9000 psychological level, establishing a new six-month low. This further decline extends […]</p>
AUD/USD (daily chart shown below) has tentatively dropped below key support around the 0.9000 psychological level, establishing a new six-month low.
This further decline extends a two-week drop that saw the currency pair breakdown below 0.9200 support, the lower border of a prolonged trading range that had been in place for a five-month period from early April to early September.
During the course of that trading range, AUD/USD hit a 2014 high just above 0.9500 in early July before retreating. Since that year-to-date high was established, price action drifted steadily to the downside before dropping sharply last week and breaking below the noted 0.9200 range support.
In breaking down below that support, the currency pair also began trading below its pivotal 200-day moving average, a condition which had not occurred since March.
Having now broken down tentatively below the 0.9000 previous support level, as well as the 61.8% Fibonacci retracement of the 2014 low-to-high, the currency pair’s bearish bias has been confirmed and extended.
The next major downside targets in the event of further AUD/USD weakening reside around 0.8850 and then 0.8659, January’s multi-year low.
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