May 2, 2013 – AUD/USD (daily chart) has dropped to a 1.0220 low in early Thursday trading, retesting the same low that was established just a little over a week ago. This occurs within the context of a short-term bearish trend extending back to the mid-April high just short of major 1.0600 resistance. For the past 10 months, price action has been confined within a clear trading range between 1.0600-area resistance and 1.0150-area support. With price now making its way back towards the lower border of this trading range, the clear downside objective resides around 1.0150 support. If this key level holds, a turn back up within the trading range may then be expected, with a major upside objective of 1.0350, after the potential turn. A breakdown below 1.0150 support would confirm a breakdown of the trading range, with a key downside support objective around parity (1.0000).
James Chen, CMT
Chief Technical Strategist
City Index Group
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