(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; 50-period simple moving average in light blue.)
5/20/2008 – AUD/USD – As of this writing, the current daily price bar on the AUD/USD price chart, as shown, has just broke out tentatively above a key dynamic resistance level. This level is represented on the chart by the top green line. The violation of this line means that price has just reached a 24-year record high in the pair, easily breaking the previous 24-year record high set just yesterday. This very significant milestone follows a long-term, consolidating uptrend in the pair that can be considered a wedge-shaped formation (as represented on the chart by the converging green lines). With the current tentative breakout to the upside, however, this wedge-like consolidation does not appear to be acting like a classic rising wedge, which is usually thought of as bearish. If price follows through to exceed the 0.9650 region, which it looks eventually poised to do, the pair will have broken the 25-year record high. The next major resistance to the upside, in this event, is the 0.9900 region.
Chief Technical Analyst
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