AUDUSD: Reverses Gains, On The Offensive

With AUDUSD reversing its Monday losses and challenging its psycho level at 1.0800, the risk is for further strengthen to occur. This if seen will leave the possibility of targeting the 1.0900 level, representing psycho level on the table. Further out, the next upside target resides at the 1.1000/4 levels and ultimately, its July 27'2011 high at 1.1078. Its daily RSI is bullish and pointing higher supporting this view. On the other hand, on any pullbacks, the 1.0749 level, its Oct 27'2011 high where a reversal of roles as support will occur and then turn the pair back up. However, if this fails to happen, we could see the pair aiming at the 1.0569 level, its Oct 31 high with a violation opening the door for a run at 1.0444 level. Below here will set the stage for further declines towards the 1.0230 level, its Jan 13'2012 low. All in all, the pair faces the risk of strengthening further.