Click to Enlarge
(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal
support/resistance levels in yellow; uptrend lines in green; downtrend lines in
red; 50-period simple moving average in light blue.)
Price action on AUD/USD has mirrored US dollar losses in other currency pairs to hit a fresh 12-month high near 0.8650. In the process, this pair has finally confirmed an uptrend continuation by breaking out above the prior 0.8500 region resistance.
This occurs after price clearly respected a key uptrend support line extending from a March low by bouncing up off the line. Within the context of the current confirmed uptrend, a major upside resistance level resides right around the 0.8800 price region.
Tentative downside support now resides in the 0.8500 region, which previously acted as resistance before the breakout. Further down, the noted uptrend support line should continue to provide significant uptrend support for the pair as long as the current trend remains intact.
By James Chen, chief technical strategist, FX Solutions
