AUD/USD (daily chart) as of February 7, 2013 has continued to fall within its trading range of 1.0150-1.0600 that has been in place since mid-July of 2012. The current down-move within this range was initiated in January when price re-tested and turned down from key 1.0600 resistance for the fourth time in the past six months. In the process, price has just established an approximate 12-week low. With the potential for further bearishness within the trading range, a move towards the bottom of the range around 1.0150 could be in the making. A further breakdown below 1.0150 support could then lead the way to a move towards parity (1.0000). Conversely, any significant upside potential for the pair would clearly be contingent upon a breakout above exceptionally strong resistance at 1.0600.
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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