2016-10-03 15:09:14

Review and dynamics
The Australian dollar is going up today due to the rise in oil prices and after the information that the situation with the Deutsche Bank is improving. Tomorrow, interest rate decision by the RBA will become known. It is not expected that interest rate will be lowered, which also contributes to the rise in the Australian currency. In mid-September, the pair AUD/USD rebounded from the important support level of 0.7490 (ЕМА50 on the weekly chart, ЕМА200 on the daily chart and the lower line of the ascending narrowing triangle).

Our opinion
The upper limit of the ascending narrowing triangle is crossing the level 0.7730.

Ascending narrowing triangle is a pattern showing that the existing trend will continue. Breakdown of the upper limit at the level of 0.7730 can trigger further rise in the pair AUD/USD.

In case of breakout of the resistance level of 0.7820 (Fibonacci 38.2% to the decline since July 2014, the highs of April) the pair AUD/USD can go up to the levels of 0.8000 (ЕМА144 on the weekly chart), 0.8130 (Fibonacci 50.0%) and 0.8200 (ЕМА200 on the weekly chart).

Note, that there is a new range between the levels of 0.7445 (Fibonacci 23.6% to the decline since July 2014) and 0.7730 (highs of August and September and the upper line of the descending channel on the weekly chart).

The level of 0.7730 is a key level of the monthly temporary range.

As an alternative scenario the pair may break down support level of 0.7445 (Fibonacci 23.6%). In this case, negative trend may prevail, and the pair AUD/USD may decline to the levels of 0.7325 and 0.7140 (lows of May). On the hourly and 4-hour charts the indicators OsMA and Stochastic give signals to buy.

Support levels: 0.7595, 0.7530, 0.7490, 0.7445, 0.7325, 0.7290, 0.7200 and 0.7140.
Resistance levels: 0.7730, 0.7820, 0.7900 and 0.8000.

Trading tips
Sell Stop: 0.7655. Stop-Loss: 0.7690. Take-Profit: 0.7600, 0.7530, 0.7490, 0.7445, 0.7325, 0.7290 and 0.7200.
Buy on the market. Stop-Loss: 0.7655. Take-Profit: 0.7700, 0.7730, 0.7800, 0.7820 and 0.7900.

In the narrowing triangle
In the narrowing triangle

Key levels are 0.7730 and 0.7490
Key levels are 0.7730 and 0.7490