AUD/USD Bouncing off support

By IBTimes Staff Reporter | July 29 2010 1:21 AM

Trading Scenario: As we mentioned in yesterday's analysis, AUDUSD is currently bouncing off bullish channel support. AUDUSD is now consolidating after it dropped from 0.9000 key level. AUDUSD has significant support from 0.8900 to 0.8850 level. As AUDUSD is still traveling in bullish channel, we will stay bullish unless it breaches it. We think that it may make an another attempt to test 0.9000 level. Any failed attempt in breaking that level may result to extend much lower on AUDUSD. We must keep in mind that it has already made a failed attempt to break the daily bearish trendline, which could be a reversal point.

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Trade Suggestion: Our suggestion is to watch for bounce from 0.8900 level and go long targeting 0.8950, 0.9000

Alternate Trade Suggestion: If price breaks below 0.8850, go short targeting 0.8800, 0.8750 & 0.8700, This will be aggressive counter trend trade.

Entry Strategy: Buying dips in an uptrend at support levels, while market trades above trend reversal level.

Trend Direction: Bullish

Trend Reversal Level: 0.8600

Key Support Levels: 0.8900, 0.8850, 0.8800, 0.8700

Key Resistance Levels:0.9000, 0.9100, 0.9230