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Talking Points

  • AUD/USD Technical Strategy: Sidelines Preferred
  • Dark Cloud Cover To Warn Of A Retreat If Confirmed
  • Awaiting Break of Narrow Band to Offer Clearer Signals

AUD/USD’s retreat from the 0.9370 hurdle has generated a Dark Cloud Cover formation. If confirmed by a successive down-day the reversal pattern may herald a retest of the 0.9280 floor. This could offer a short-term range-trading opportunity. Yet the juice left to squeeze appears somewhat limited. This leave awaiting a break of the pair’s narrow corridor preferred.

AUD/USD: Range May Remain As Dark Cloud Cover Emerges

AUD/USD Range May Remain As Dark Cloud Cover Rolls In

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

As noted in the last candlesticks report, the four hour chart offered an early warning of a correction. The Bearish Engulfing formation signaled the potential for a pullback near the 0.9370 barrier. However, the bears appear to have lost steam in intraday trade as denoted by a Doji candlestick near 0.9327.

AUD/USD: Bearish Engulfing Pattern Warned Of An Intraday Correction

AUD/USD Range May Remain As Dark Cloud Cover Rolls In

4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

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