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The Australian Dollar is attempting to launch the next leg of an advance started in late January after bouncing from rising channel support. A break above the 23.6% Fibonacci expansion on a daily closing basis targets the 0.9460-0.9507 area, marked by the April 10 high and the 38.2% level. Alternatively, a turn below 0.9318 – the intersection of the channel floor and the 14.6% Fib – exposes a horizontal support shelf at 0.9229.
Risk/reward considerations argue against entering long with prices squarely at resistance. We will continue to stand aside for now, waiting for a more attractive setup to present itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com