AUD/CADâ,“ AUD/CAD continues to recoup losses iincurred since May 2005 and currently trades just shy of its upper Bollinger band on the daily. An inverse head and shoulders reversal pattern has formed on the daily over the past 3 months. The neckline, acting as resistance, rests at about .8490 and a break would expose the 23.6% fibo of .9856-.8208 at .8595. If the pair remains within the .8200-.8500 range, look for support at yesterdayâ,"s low of .8414 with further weakness giving scope to the 38.2% fibo of .8208-.8492 at .8384.
AUD/JPY â,“ AUD/JPY has retraced a little over 50% of its 91.33-82.06 decline from December 2005-March 2006 the rally from 82.06 is looking weaker, especially with yesterdayâ,"s reverse hammer on the daily. The pair is also trading right at a resistance trendline that begins at the 91.33 high made in December 2005. A break above the trendline exposes yesterdayâ,"s high at 87.31 with additional gains targeting the 61.8% fibo of 91.33-82.06 at 87.78. If the line of resistance holds, then the pair could see a decline to the confluence of the 200 day SMA / 23.6% fibo of 82.06-87.31 at 86.08. The 2/27 low at 85.42 serves as support in the event of a break below the 86.00 figure.
AUD/NZD â,“ AUD/NZD has turned around after making its high at 1.2015 on 4/11. Last weekâ,"s commentary proved accurate as it noted that â,"The slightest divergence with RSI on the daily chart combined with the long term fibo resistance suggests that 1.2015 may have been a top.â, Indeed, the pair has fallen and looks to drop even more with the recent negative MACD cross on the daily and other oscillators such as RSI increasingly decreasing. Continued weakness targets the 4/13 low of 1.1664 and the 4/3 low of 1.1587. The 38.2% fibo of 1.0428-1.2015 comes in at 1.1409 in the event of a freefall. Strength would run into the 38.2% fibo of 1.2015-1.1664 at 1.1796 with additional buying seeing the 4/17 high at 1.1844.
Sam Shenker is a Technical Currency Analyst for FXCM.
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