The Aussie Breaks the 3 Month Trend Line

AUD/USD (0.7553)

Points to consider in the Aussie Dollar Forex market:

• Aussie Dollar breaks below the three month old trend line support.
• Short order set. Still need better risk to reward conditions.
• Trade strategy: Pending Short AUD sale at 0.7598

The AUD/USD Forex market has broken below the rising trend line in play for three months. This trend line had been guiding prices higher since late May. The Aussie Dollar marked the top with the appearance of a bearish evening star candlestick, which is seen on the below daily MT 4 chart. The US Dollar is strengthening on the back of hawkish comments made by Federal Reserve Chair Janet Yellen who spoke last Friday at Jackson Hole. Please use the below MT 4 chart for today’s technical analysis.

Aussie Dollar Technical Analysis

Let’s discuss today’s AUD/USD daily technical analysis. There is near term support lining up at 0.7495. A daily close below this first downside barrier challenges the next technical support lining up at 0.7415. The alternative Australian Dollar technical analysis, notes a cluster zone that runs to the June 24 high. This first upside barrier is at 0.7598 to 0.7648. A break above this first upside barrier challenges the technical barrier at the August 11 high. This level lines up at 0.7760.

Trade Strategy

Let’s now discuss today’s trade strategy in this particular Forex market. Price action is too close to a near term support to enter a short AUD sale. Timing is too premature from a risk to reward perspective. Keeping that in mind, I will enter a short AUD sale to go active at 0.7598. If it goes live, then the first target is at 0.7495. A stop loss, initially, will be place to go active with a daily close above 0.7648.