The AUD/USD pair rose during the session on Monday in an attempt to get back above the 1.02 level. Interestingly enough however, we did fail at that level and form something that looks I can do a shooting star. While this candle by itself isn’t enough to get us short of this market, a break of the bottom of Monday’s candle certainly would be enough. Because of this, we think that the real risk is certainly to the downside at this point time, and with several stock indices that we follow looking vulnerable all of the sudden, we think the Australian dollar could get whacked at this point.
Conversely, if we managed to get above the 1.0250 level on a daily close we think that the reversal would happen and we would more than likely run back towards the 1.06 level as this pair has been consolidating between it and 1.02 for some time now.
Written by FX Empire