Forex Technical Update
AUD/USD started the week completing a downswing from from 1.0223 to 1.0029. A corrective rally has developed. Note in the 1H chart that this rally has touched the 1.0150 pivot, where 61.8% retracement level resides. This was also the range support during the 11/30 to 12/8 consolidation period. Meanwhile the RSI tagged 60. If the market is to remain bearish, this is a good pivot to turn back south.
The 4H chart shows the market respecting 1.0050. However, a failure to rally back above 1.0150 should be a bearish sign for the market to retest 1.0050, and then the 50% retracement at 1.0019. Below that we are looking at 61.8% retracement at 0.9934. It should be noted that on the 4H chart, the RSI is still struggling to break below 40 to reflect loss of bullish momentum. Ability to do so as well as tag 30 would be major bearish momentum signals that also opens up lower targets like the 78.6% retracement level at 0.9813, and the 0.9660 November low.
Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources