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AUD/USD Technical Analysis: Down Move Below 0.71 Expected
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Talking Points:
AUD/USD Technical Strategy: Short at 0.7187
Australian Dollar vulnerable to deeper losses following support break
Short position triggered on expectation of decline below 0.71 figure
The Australian Dollar looks poised for deeper losses after prices established a foothold below the 0.72 figure against its US counterpart. Prices turned downward as expected after carving out a bearish Evening Star candlestick pattern above the 0.78 threshold.
From here, a break below the 76.4% Fibonacci retracement at 0.7065 paves the way for a test of the January 15 low at 0.6827. Alternatively, a reversal back above the 0.7212-43 area (61.8% level, February 4 high) sees the next upside barrier in the 0.7300-31 region (May 10 low, 50% Fib).
Technical positioning and risk/reward parameters now appear attractive to enter short and a position has been triggered at 0.7187, initially targeting 0.7065. A stop-loss will be activated on a daily close above 0.7243. Profit on half of the trade will be booked and the stop-loss trailed to breakeven when prices hit the first objective.
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