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Important AUD Pairs: Technical Check


With seven years' low print by the Australian CPI, market players rolled-on their sleeves to cut the AUD longs, resulting into sharp sell-off in pairs connecting to the Australian Dollar. AUDUSD, being no exception broke down the short-term ascending trend-line and is presently trading around two week's low, indicating further south-run towards 0.7570 immediate support prior to testing the 0.7520-10 important support-area, comprising 50-day SMA and the lower-line of three month old ascending trend-channel. If the pair stretches the downside below 0.7510, also clearing the 0.7500 – 0.7490 support-zone, including 50% Fibonacci Retracement of its May 2015 – January 2016 downside, it becomes vulnerable to test 0.7390-85 multiple support-region. However, pair's close above 61.8% Fibo, at 0.7650, might give rise to its immediate pullback towards 0.7700 and then towards 0.7770; though, 0.7850-60 horizontal resistance might confine its further upside. Given the pair's successful break above 0.7860, it becomes capable enough to test channel resistance level of 0.7960.


Unlike AUDUSD, which is drawing south towards channel support, the EURAUD's up-move seems held captive by immediate trend-line resistance of 1.4850, followed by the 50-day SMA level around 1.4900 mark. If only the pair manages to close above 1.4900, it can extend its recent recovery to 1.5000 psychological magnet prior to aiming the 100-day SMA level of 1.5160. Further, pair's successful break above 1.5160 enables it to aim for 1.5400 resistance level. On the downside, 61.8% Fibonacci Retracement of its April – August 2015 run-up, near 1.4785, can serve as nearby support for the pair, clearing which 1.4630, 1.4500 and the recent lows of 1.4430 are likely following support levels it could test; however, 1.4350-40 horizontal support can hold its further weakness confined.


Having breached seven month old upward slanting trend-line support, the AUDUSD dropped to the 0.9580-75 horizontal support; though, oversold RSI indicates brighter chances for the pair's pullback to 0.9630 adjacent resistance, breaking which 50% Fibonacci Retracement of its September – December 2015 upside, near 0.9660, is likely following level that the pair might aim for. Given the pair's sustained trading above 0.9660, the 200-day SMA level of 0.9700 and the 0.9750 are likely consecutive upside numbers that the pair traders should look at. Alternatively, a daily close below 0.9575 indicates pair's further decline towards 61.8% Fibo level of 0.9535 and then to 0.9500. Further, failure to stop the south-run at 0.9500 signals the pair's extended downward trajectory towards 0.9440 and the 0.9380 supports.


Even if the AUDNZD dropped to two week's low, the pair's break of 50-day SMA level of 1.1080 might find it difficult to clear the 1.1040-35 horizontal support, which if broken can drag the pair to 1.0970 and then to 1.0890 mark, including 100-day SMA and the 38.2% Fibonacci Retracement of its April – August 2015 upside. Additionally, pair's break below 1.0890 can indicate it further weakness towards 50% Fibo level of 1.0720. Should the pair reverses from the current level, a close above 1.1150 becomes necessary for it to aim towards 1.1210 and the 1.1260 resistances. However, pair's further advances beyond 1.1260 might find it difficult to clear the 1.1320-30 resistance-region.

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Thursday, 28 Apr, 2016 / 12:41

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