AUD/USD 1H chart 1/16/2013 10:55PM EST
Range breakdown, employment data: AUD/USD broke below 1.0520 range support during the US session following the disappointing employment data. Forexfactory.com reports that there was a -5.5K change, or jobs lost while the forecast was for a 2.3K jobs gained for the month of December.The range breakout is a sign of the continuation of recent correction against an upwards channel that started around Christmas.
Channel support, momentum: The 1H AUD/USD chart also shows price action about to challenge a rising channel support that has held price above it through this new year holiday and new year rally. The momentum is showing some bearish signs as the 1H RSI reading tags 30. However, the bearish momentum is still young in development, and price has first the 1.05 handle to clear as well as the rising support. The bearish outlook will very likely grow stronger below these support factors, first with a possible 61.8% retracement at 1.0440 in sight.With further confirmation like respect of the broken channel as resistance, the December low at 1.0344 can also be in sight.
However, if the market supports AUD/USD with this apparent trendline and it rallies back above the 200-SMA near 1.0535, we might be looking at a bullish continuation, especially if the RSI pushes back above 60. This will at least put focus back at the 1.06 handle.
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.
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