Forex Analysis: AUD/USD Bullish Correction within Strong Bearish Trend



June 14, 2013 – AUD/USD (daily chart) has made a significant bullish correction within the span of the past week to bump up against the 0.9650 resistance area. The recent downtrend, which has effectively been in place since the April high near 1.0600, has been strong and steep with very little in the way of substantial upside corrections. The current advance could be an exception. Momentum above the 0.9650 area could potentially lead the way to a partial recovery back up towards parity (1.0000). Perhaps more likely, however, the current bullishness should exhaust itself well below parity and turn towards a resumption of the entrenched downtrend. In this event, downside support objectives include a re-test of this week’s 0.9325 low, and then further down towards the 0.9200 and 0.9000 support areas.

James Chen, CMT
Chief Technical Strategist
City Index Group

Forex trading involves a substantial risk of loss and is not suitable for all investors. This information is being provided only for general market commentary and does not constitute investment trading advice. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any financial instrument and should not be used as the basis for any investment decision.

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About Author

James Chen is Chief Technical Strategist for City Index Group. He is also a Chartered Market Technician. He is the author of the books: "Essentials of Foreign Exchange Trading" (John Wiley & Sons, 2009) and "Essentials of Technical Analysis for Financial Markets" (John Wiley & Sons, 2010). Mr. Chen writes currency analysis, leads forex trading seminars and has appeared in numerous major financial media outlets, including CNBC, Bloomberg TV, Forbes, Reuters, Dow Jones, and the Associated Press.