(MENAFN- DailyFX) AUD/USD collapses through April range lows- big figure support near 70 Check out our 2019 projections in our Free DailyFX USD Trading Forecasts Join Michael for Live Weekly Strategy Webinars on Mondays at 12:30GMT The Australian Dollar is down more than 2.4% against the US Dollar from the monthly highs with Aussie breaking below yearly open support today. These are the updated targets and invalidation levels that matter on the AUD/USD charts this week. Review this week's Strategy Webinar for an in-depth breakdown of this setup and more.
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AUD/USD Daily Price Chart Technical Outlook: In my latest AUD/USD Weekly Price Outlook we noted that Aussie was, 'trading within a critical range between 7020-7184 and we're looking for the breakout to offer guidance on our medium-term outlook. From a trading standpoint, the immediate risk is lower within this range but look for a reaction on a drop towards yearly open support. Price is approaching the lower bounds of this key range today after breaking below pitchfork support / the April opening-range lows note that daily RSI failed to surpass the 60-threshold and further highlights the broader bearish momentum profile.
Daily support rests with the yearly low-day close at 7005- a break / close below this level would be needed to keep the short-bias viable targeting the 61.8% retracement of the yearly range at 6955. Monthly open resistance steady at 7122 with broader bearish invalidation at the 200-day moving average / 61.8% retracement at 7184/85.
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AUD/USD 240min Price Chart Notes: A closer look at price action shows Aussie trading within the confine pf a descending pitchfork formation extending off the March / April highs with price approaching confluence support just lower at 7005 look for a reaction there IF reached. Initial resistance stands at the highlighted trendline confluence just below 7100 backed by the monthly open at 7122 both levels of interest for possible exhaustion / short-entries.
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Bottom line: Aussie has broken significant support and keeps the focus lower in price that said, the decline is now approaching initial areas of support that could offer a near-term reprieve. From a trading standpoint, look to reduce short-exposure / lower protective stops on a test of the 70-handle with weakness beyond this zone needed to keep the bears in control. Be on the lookout for possible exhaustion there IF price fails to close below.
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AUD/USD Trader Sentiment A summary of IG Client Sentiment shows traders are net-long AUD/USD- the ratio stands at +2.61 (72.3% of traders are long) bearishreading Long positions are23.2% higher than yesterday and 66.4% higher from last week Short positions are 31.1% lower than yesterday and 52.9% lower from last week We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Aussie prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger AUD /USD-bearish contrarian trading bias from a sentiment standpoint. See how shifts in AUD/USD retail positioning are impacting trend- Learn more about sentiment!
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https://www.dailyfx.com/sentiment?ref-author=Boutros
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