Forex Technical Update

AUD/USD 4H chart 2/4/2013 10:14AM EST

audusd02042013h4

RBA, Choppiness: This is a week of several central bank meetings, the first of which is the Reserve Bank of Australia (10:30PM EST, 3:30AM GMT). We have seen AUD/USD from its early January heights above 1.06 down to 1.0360 last week. It starts this week with a push back above 1.04. Looking at the 4H chart, you can see that since breaking below 1.04, and below a rising trendline (better seen in the daily chart), the AUD/USD has been chopping around the 1.04 handle.

Momentum: The momentum has turned bearish in the 4H chart. Really, what we are seeing is a loss of bullish momentum, but with weak bearish momentum so far. It can be said that there is a bearish bias, but not that of a bearish trend, more like neutral-bearish.

Range-bound: The daily chart also shows a range-bound market going back to the summer of 2012. Will the RBA provide any spark for direction? If not, this is an extremely difficult pair to call until we have a break above 1.05, which could reopen focus on the 1.0625 . To the downside, direction (within the context of an overall range-bound market, needs at least a break  below 1.0345, in which case, we would be focused on 1.0285 in the near-term, with further bearish extension to focus on the 1.0150 range- low.

AUD/USD Daily chart 2/4/2013 10:15AM EST

AUD/USD 2/4/2013 daily chart

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.

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