Resistance Remains Strong in the AUD/USD
The AUD/USD continues to try and take out 80 cents.
I’ve been focused heavily on the AUD/USD over the last week or so, as we’ve been at a very important point. 80 cents has been in-play and this is a level that I feel we aren’t going to be able to crack all that easily.
Looking at the charts we can see that we’ve had some pikes through that area, however as yet nothing has held. Add to that the slew of positive economic data that we saw in Australia also and that adds to my bearish sentiment.
We’ve thrown the kitchen sink at the 80 cent level all to no avail.
This week the economic calendar is a little thin. And in fact, we also have the Australia Day long weekend which will limit trade considerably.
Sell the Spike
I’m still a believer in selling the spikes. Longer-term I would be surprised if we can break out above 81 cents. That’s basically been the top in the most recent past and again I’m just not sure that we have the fundamentals in place to push us much higher.
What I am looking for is a blow-off top. I think we can certainly spike higher and that might not be a sustained move, but one that will quickly retrace. So be on the lookout for that type of price action. Certainly, if the USD breaks down early in the week.
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