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AUD/USD: More pressure towards upper 0.86 ahead - TDS
FXStreet (Bali) - The FX Strategy Team at TDS recommends to fade AUD strength, e.xpecting further pressure to build up towards the upper 0.86.
Key Quotes
"AUDUSD broke through minor trend resistance last week but the overall pattern of short-term corrective price moves ahead of another push lower remains intact via the developing bear flag."
"Daily signals/oscillators continue to contradict each other somewhat, however; the top of the October consolidation range was reinforced by Wednesday’s push lower from 0.8909 (where we expected firm resistance last week) via a bearish outside range/key reversal day. That is a clear negative and suggests more pressure on support in the upper 0.86 area ahead. However, daily trend momentum is currently weak and, if we do push lower, a break out is not guaranteed near-term. Overall though, we would rather look to fade AUD strength."
"AUDUSD has backed off the early 2014 low steadily through October but gains have been relatively shallow and the weekly charts highlight the fact that the AUD has failed to hold on to strength; below 0.8640/60 targets a quick drop back to 0.84/85. But the implication of the daily bear flag is a repeat of the scale of the September/October drop from the breakdown point."