ICM Technical Analysis : AUD/USD 28 February 2020

ICM Technical Analysis : AUDUSD – 28 February 2020

Following Wednesday’s pivotal run to multi-year lows at 0.6542, AUD/USD pencilled in a reasonably impressive recovery Thursday amid continued USD softness. Earlier in the day, private capital expenditures in Q4 disappointed, though the candles remained at pre-announcement levels.

0.66 is closing in fast on the H4 timeframe, with previous ranging activity (green) around this number likely a difficult slab to hack through. A break higher, nonetheless, could have buyers and sellers square off around channel resistance, extended from the high 0.7031.

Further afield, longer-term movement on the weekly timeframe recently shook hands with a rising wedge take-profit target at 0.6599 (black arrows – calculated by taking the height of the base and adding it to the breakout point). This pattern took five months to complete; well done to any readers who took part. With price nudging marginally beyond this barrier, however, continued downside on this scale could eventually see support at 0.6359 (not visible on the screen) enter view.

Aligning closely with the round number 0.66 on the H4 scale, daily price, leaving support at 0.6508, is also seen drawing nearer to channel support-turned resistance, taken from the low 0.6677.

Areas of consideration:

While a rebound higher could form on the weekly timeframe off the rising wedge take-profit target, the combination of daily channel support-turned resistance and the 0.66 handle on the H4 timeframe may serve as a reversal zone today, ultimately targeting daily support at 0.6508 and the 0.65 handle.

Conservative stop-loss placement is likely beyond H4 channel resistance, taken from the high 0.7031, though above the 0.6622 February 25th high might be more of a realistic location for most traders (red arrow).

Disclaimer: The information contained in this material is intended for general advice only.