The Aussie now has a topping pattern on it at .9070 and if you look at the medium term fib you can see the 38.2% resting at .9077, so there are a few reasons to be short the Aussie today. Overnight we hit the target of .9015 and sellers should have covered to there. However, to be fair, I can see this coming lower over the next few sessions and would be looking at .8983 as a realistic short term objective. At that point we would look to cover all short positions.
Still, the topping pattern cannot be ignored and if we break through .8975 we are going to see the Aussie come quite a bit lower. If that happens, .8920/16 would be the figure that will entice. We also have a small speedbump at .8939 that we need to be aware of.
The only way weakness is not going to happen is if the buyers take us beyond .9090 and stay there. If we see this, the market will shrug off overbought indicators and we can then trade higher with .9105 then .9135/40 targeted. At that point we'd cover all longs. Look to re-instate further longs above .9145 as this targets .9170. Personally, I think there is more substance for a downside move. We will see...
