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
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.Get the 5 most predictable currency pairs