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AUD/USD 4H Chart 8/14/2012 8:40PM EDT

The previous assessment of AUD/USD that suggested a flat correction was wrong. Instead of continuation the bullish phase, the AUD/USD is rounding a top. The break below 1.0495 near-term support opens up the next key pivot at 1.0440. The RSI fell below 40, suggesting a loss of the momentum seen in the latest bull run from July 25 to August 9. Expect at least some brief support at 1.0440 as the market will be testing a key pivot and the RSI in the 4H chart will probably be at or below 30, reflecting a near-term oversold condition.

The market is bearish remains bearish if it can break below 1.0440, but only in the very short-term. A break below the channel support seen in the daily chart is probably needed to convince the market of that the bull run since the end of May is broken.

AUD/USD Daily Chart 8/14/2012 8:45PM EDT

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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