Trading Scenario: As we mentioned in yesterday's analysis it proved 0.9000 to 0.9100 range was as critical level. AUDUSD reversed from that zone and dropped below 0.9000 after CPI data came out. If we look into charts, AUDUSD yesterday came into bearish daily trendline test in the zone of 0.9000 to 0.9100, which it failed to break and fell below 0.9000. This push below 0.9000 may take this pair to 0.8850 where it has got significant support and also bullish channel support.
As AUDUSD is now in bullish channel, any breach of this bullish channel support at 0.8850 may push this pair to 0.8600 level. Its very important now to closely watch price behaviour at 0.8850 level. If price was able to sustain above then it might make another move up targeting 0.9000 and 0.9100
Important Note: Yesterday's Close on AUDUSD resulted in an Inverted hammer, which is a caution/point of reversal.
Trade Suggestion: Our suggestion is to watch for bounce from 0.8850 level and go long targeting 0.8900, 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