2016-11-23 14:56:11

Review and dynamics
Due to sharp rise in the USD the pair AUD has broken down important support levels of 0.7525 (ЕМА200 on the daily chart, ЕМА50 on the weekly chart), 0.7445 (Fibonacci 23.6% after the decline from July 2014). The pair remains in the new descending channel on the daily chart. The lower limit of the channel is below the level of a break of either 0.7315 (November lows).

Our opinion
Despite current correction caused by profit-taking, the USD continues to dominate in the currency market. The Australian dollar remains under pressure from the decline in the prices of commodities, such as oil, gas, coals and iron ore.

Although upward correction is going on and the pair AUD/USD has been grown for three days, it is still remains below the key level of 0.7445.

If the decline continues and the pair breaks down the level of 0.7315, next target will be at the level of 0.7140 (lows of May).

On 4 hour and daily charts the indicators OsMA and Stochastic give signals for long positions, which confirms current upward correction in the pair. However, on the weekly and monthly charts the indicators give signals for short positions.

From a technical point of view, the rise in the pair above levels of 0.7445, 0.7460 (ЕМА200 on the hourly chart) may trigger further growth in the pair AUD/USD with the target of 0.7525. However, from a fundamental perspective, the USD will continue to dominate in the market, which may prevent further growth in the pair AUD/USD above current levels.

Breakdown of the two key support levels of 0.7525 and 0.7445 may terminate upward correction after the decline since July 2014 to the lows of 0.6835.

As an alternative scenario the pair will go up and consolidation above the level of 0.7525. In this case the rise may continue up to the levels of 0.7700, 0.7775, 0.7820 (Fibonacci 38.2% and highs of April), 0.7960 (ЕМА144 on the weekly chart) and 0.8130 (Fibonacci 50.0% and ЕМА200 on the weekly chart).

Support levels: 0.7375, 0.7315, 0.7290, 0.7200 and 0.7140.
Resistance levels: 0.7445, 0.7460, 0.7525, 0.7600, 0.7700, 0.7750 and 0.7820.

Trading tips
Sell on the market. Stop-Loss: 0.7480. Take-Profit: 0.7410, 0.7375, 0.7315, 0.7290, 0.7200 and 0.7140.
Buy Stop: 0.7480. Stop-Loss: 0.7410. Take-Profit: 0.7525, 0.7600, 0.7700, 0.7750, 0.7820, 0.7900 and 0.7960.

In the descending channel
In the descending channel

Near resistance levels of 0.7445 and 0.7460
Near resistance levels of 0.7445 and 0.7460