Talking Points:
- AUD/USD Technical Strategy: Short at 0.7735
- Support: 0.7656, 0.7577, 0.7498
- Resistance:0.7777, 0.7814, 0.7912
The Australian Dollar launched a recovery against its US namesake having declined as expected after putting in a Bearish Engulfing candlestick pattern. Near-term resistance is in the 0.7754-77 area, marked by the 23.6% Fibonacci expansion and a falling trend line, with a break above that on a daily closing basis exposing the 14.6% level at 0.7414. Alternatively, a turn below the 38.2% Fib at 0.7656 clears the way for a challenge of the 50% expansion at 0.7577.
We entered short AUD/USD at 0.7735 and subsequently booked profit on half of the position. The rest of the trade remains open to capture any further downside. The stop-loss has been adjusted to the breakeven level (0.7735).