AUD/USD on the edge of breaking the up-trend

Source: Dukascopy Bank SA
© Dukascopy Bank SA
"The current 'death valley' at US$0.7700-US$0.7750 remains intact, suggesting that investors continue to grow cautious of not only the long Aussie position overhang, but also the sustainability of iron ore prices." 
- Stephen Innes, trader at OANDA (based on The Business Times)


Pair's Outlook 
The commodity currency, namely the Aussie, managed to prolong the ascending channel pattern yesterday, but risks breaking it to the downside today. Expectations of the Fed raising rates as soon as March keep fueling the US Dollar, allowing it to take the upper hand against the Australian counterpart. Even though the channel's lower boundary is underpinned by the weekly PP, a close below 0.7650 would not be a surprise; however, this mark could still act as a potential psychological support. Meanwhile, the second notable support rests only around 0.7625, formed by the 20-day SMA and the weekly S1. 

Traders' Sentiment 
There are 68% of traders holding short positions today (previously 67%). At the same time, the number of sell orders inched down from 58 to 55%.
© Dukascopy Bank SA

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