© Dukascopy Bank SA
AUD/USD has been trading in the 1200 pip range since the beginning of October, 2011 and has formed a Rectangle pattern on the 1D chart. The pattern has 57% quality and 86% magnitude in the 208-bar period.
The pattern started on the 4th of October, 2011, when the pair bounced from 0.9388 and after testing pattern's support and resistance band twice it has slowed down next to SMA200 level at 1.0284 where the pair is currently trading. Pattern's support band is at 0.9622; resistance band is at 1.0805. The SWFX market sentiment shows that 60% of the traders expect the pair to appreciate. Technical indicators on aggregate point at further augmentation of the pair on 1D time horizon. Long traders, expecting that the pair will resume its movement towards patterns resistance band, could focus on the 5th of July high at 1.033. If the pair breaches this level next target could be set at the recent high of 1.0444 and mid and late April peaks at around 1.0460.
Technical indicators on aggregate point at a bearish market development on the 1W time horizon indicating that SMA200 most likely is a strong support/resistance level for the pair and pair might stay close to it in the near term. Short traders could focus on the 20th of June peak at 1.0225. If this level is breached, next targets could be set July plunges at 1.0155 and 1.0101.
Due to interlink between Australian and New Zealand currencies traders should pay attention to the Reserve Bank of New Zealand rate statement and official cash rate announcements on 25th of July. Australian dollar being on of commodity currencies and significant amount of economic data coming out from the US every week should not be forgotten as well.
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