AUD/USD Price Analysis: Bears eye the daily chart's W-formation near 0.7235

AUD/USD bulls are throwing in the towel as per the hourly chart.
The bears can target the daily W-formation's neckline.

Ross J Burland FXStreet

AUD/USD has risen sharply as the US dollar plummets below critical daily support. However, the W-formation is compelling, especially with the DXY now stabilising at deeper support as follows:

DXY daily chart

There are prospects f a bullish correction in the US dollar for the sessions ahead.

AUD/USD daily chart

This rhymes with a downside correction in the Aussie as illustrated above. The W-formation is a reversion pattern and there is a high probability that the neckline will be retested as support in due course. This comes in near 0.7235.

AUD/USD H1 chart

From an hourly perspective if the price breaks support, then the 61.8% Fibonacci retracement that aligns with prior structure and the W-formation's neckline will be eyed.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.