(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
9/29/2009 – AUD/USD – After hitting a 13-month high close to the 0.8800 resistance last week, price action on AUD/USD, a daily chart of which is shown, has consolidated horizontally just above a key uptrend support line extending from the March lows. This currency pair is still very much entrenched in a clear uptrend, and the directional bias still appears to be to the upside. The key upside resistance level to watch for is the noted 0.8800 resistance, a breakout of which would confirm an uptrend continuation. In this event, a further resistance target to the upside resides around the 0.8950 price region, although since that level has not been seen for over 13 months, its ability to act as resistance is somewhat questionable. Support levels to the downside are clearer. There is the noted uptrend support line serving as dynamic support as well as the key 0.8475 level, which was just broken to the upside in the beginning of this month. Any significant breakdown below this level should place the current prevailing uptrend in serious jeopardy.
James Chen, CMT
Chief Technical Strategist
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