I’ve got my eyes on this textbook retracement play on AUD/USD.
Do you think Aussie bulls are about to return at any of these levels?
I’ve had a bearish bias on the commodity currencies the other week with my CAD/JPY short play, but now I’m switching to a bullish one!
This neat trend retracement play on AUD/USD might be too good to pass up, as the pair is approaching an area of interest visible on the 1-hour time frame.As you can see from the chart above, the 61.8% Fibonacci retracement level coincides nicely with a former resistance zone and the rising trend line that’s been holding so far this month.
Technical indicators are suggesting that support levels are likely to hold, with the 100 SMA above the 200 SMA and Stochastic starting to pull up from the oversold area.
Heck, a shallow correction might already find plenty of buyers at either the 50% Fib or at current levels!Keep in mind that the Land Down Under just printed a stronger than expected retail sales report for March, boasting of a 1.4% rebound in consumer spending after the earlier 0.8% decline.
Other than the flash manufacturing PMIs from both the U.S. and Australia due on Friday, there are no noteworthy economic catalysts for the rest of the week. With that, AUD/USD might have to rely on risk appetite in order to resume its rally.
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