AUD/USD Reaching Key Resistance on Daily Chart
05/22/2009 12:01 am EST
Price action on AUD/USD, a daily chart of which is shown, has reached up to key resistance around 0.7800 before turning and retreating back down to the 0.7700 region. The 0.7800 level has been the major resistance target since the breakout above 0.7300 in early May.
Now that this important target has been reached, price is now at a very significant technical juncture. A continuation of the uptrend that has been in place since the lows in early March would be confirmed on a strong break above 0.7800, in which case a significant upside target resides around the psychologically important 0.8000 level.
Downside support within the context of the current uptrend resides around the 0.7450 region, which is the level of the last swing low within this uptrend.
By James Chen, Chief Technical Analyst, FX Solutions