Price action on AUD/USD, a daily chart of which is shown, has tentatively broken down below a key medium-term uptrend line extending from the early-February low. This occurs after price failed to reach 0.9325 area resistance in its prior bullishness.
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The tentative trend line breakdown places the pair firmly within the current overall trading range consolidation that has been in place since at least the November highs. In the event of a continuation of the bearishness that resulted in the noted trend line breakdown, a key downside target within the current consolidation resides around the 0.8800 price region. To the upside, in the event of a reversal of the bearishness that prompted the trend line breakdown, the mentioned 0.9325 price area should continue to serve as near-term range resistance.
By James Chen, chief technical strategist, FXSolutions.com
