Forex Technical Update
The 4H AUD/USD chart shows the market breaking below a descending triangle. This dip shows the failure of the market to sustain a rally after a double bottom formed between 4/4 and 4/11. The 4H chart shows that the rally broke above a decliningtrendline, but stopped at the 1.0450-1.0460 resistance area. This shows a failure to develop a bullish market after the upside breakout. Now, the market is flat, ranging between 1.0450-1.0460 and 1.0224-1.0240.
The daily chart shows that the market has also broken below a rising trendline, going back to Oct. 2011. This break has not been convincing, and we already saw that the market also broke to the upside. Basically, the market is anchoring out of these converging trendlines by trading sideways. The 1.0225-1.0240 support area will need to be broken to open up further downside risk. The first support pivot is in the 1.0145-1.0150 area. Below that, the market could be reaching toward parity (1.00).
Fan Yang CMT is a trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.