- Daily: I have been monitoring the AUD/USD as it made its second leg of rally from 0.8600. (Refer to Daily Technical Update 3.4.2010 AUD/USD). I also noted that the established mode has been a bullish trend, and it was therefore prudent to anticipate a possible breakout above.
- Today the US session started with a strong attempt to crack the declining trendline channel resistance as it completes a swing projection at 0.92.
- The stochastic shows overbold conditions, but has not signaled a reversal just yet.
- 4H: It would be prudent not to jump to the bearish outlook simply because it is testing resistance. The 4H time-frame shows a strong intermediate bullish mode, as the moving averages diverge and the stochastic stays in a bullish range since March.
- It is probably best to observe any corrections that may result from the current resistance at 0.92, and if it breaks cleanly, wait for a throwback to confirm a weak bearish forces and a continuation of the bullish mode.
Fan Yang
Currency Analyst
Commodity Trading Advisor
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. CMS 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 analyses.
Foreign currency trading is not conducted on an exchange. CMS is acting as a counterparty to its clients’ transactions and as a result, CMS’ interests may be in conflict with its clients. Since CMS acts as the buyer or seller in the transaction one should carefully evaluate any trade recommendation provided by CMS or any of its solicitors. Foreign currency trading involves a substantial risk of loss and may not be suitable for all investors.
All screenshots are made from VT Trader 2.0 and are of actual market data at the time of the screenshot.