The AUD/CAD has come under heaving selling pressure after peaking to 0.9841 in July, and may fall further as the downtrend continues to hold.
Currency Pair: AUD/CAD
Short-Term Bias: Short
Chart: 15 Min Charts
Analysis Update
The AUD/CAD has bounced back after touching the lower channel, and continues to hold within the channel. Price action looks to be moving higher, but we expect the downward trend to hold for the time being.
We expect the pair to test 0.8949 (21.4% Fib level) for resistance over the next few hours, which could lead the AUD/CAD to cross over the 120 SMA line. The sharp downtrend in the 120 SMA has led us to hold our bearish outlook for the aussie, and we expect price action to move lower over the next few trading session. The downward momentum should lead the pair below 0.8900, and may test 0.8825 for support in the coming weeks. However, the fundamental event risks scheduled for the next 24 hours may call for a change in our outlook.
Analysis
The AUD/CAD has come under heaving selling pressure after peaking to 0.9841 in July, and may fall further as the downtrend continues to hold. However, the big selloff during the previous session has triggered an oversold RSI signal, and may lead price action to move back towards the top of the channel within the next few hours.
After moving above the channel yesterday, price action has retraced back into the channel, and could be hitting resistance near 0.8949 (21.4% Fib level). The sharp downturn in the 120 SMA has led us to hold a bearish outlook for the pair, and we expect price action to break below 0.8800 to find support near 0.8775. Be sure to check out Jamie’s Technical Outlook for additional information on the major currency pairs
To contact the author of this article, please email: dsong@fxcm.com
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