Australian Dollar: Further Corrections?
Carol Harmer | May 16, 2013 03:48AM ET
Aussie managed to hold onto its 200 week M./A by the skin of its teeth yesterday, on a close basis. We did not break out 9842 break point and therefore it is better to be long of Aussie on any dips, holding unless we lose 9830. It is a low R/R trade.
240 min charts have already turned bullish, as yet however the dailies have not but we are at extreme oversold levels and the RSI is also beginning to turn higher so we must be aware of this. Anywhere from 9870 to 9850 would be a good starting area to reinstate longs holding unless we lose 9830. We have resistance at 9920/40 and here we should see some profit taking.
However, I think sellers will back off of re-selling here given the market conditions, and therefore if we do break through 9940 we are going to be looking at the market correcting further and there is scope for 10095 which was the trendline breakpoint last week.
Now, the alter scenario. Below 9830 and we are going to come under increasing pressure to trade lower. You see my medium term projection of 0.9580/70. However 0.9785/80 offers a viable short term objective.
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