AUD/USD Short-Term Falling Trend Line (May 20, 2013)

The trend remains very bearish for the pair and there could be shallow retracements for the week.

On the 1-hour time frame, there’s a falling trend line connecting the pair’s recent highs. Using the Fibonacci retracement tool shows that the 38.2% Fibonacci retracement level is close to the .9800 major psychological level. This level has acted as support last week and could act as resistance from now on

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Stochastic is still moving up, which suggests that the pair could still pull up to the 61.8% Fibonacci level, which is closer to the falling trend line. Set your stops above this area or the .9850 minor resistance if you’re shorting.

The only major release from Australia this week is the RBA monetary policy meeting minutes. The U.S. dollar could continue to draw support from talks that the Fed is already mapping out plans to exit its bond purchases.

By Kate Curtis from Trader's Way