AUD/USD Bullish Trendline Breaks; Key Level 0.9135

The Aussie fell sharply on weak investor confidence as news that Dubai attempts to reschedule its debt payments dampened demand for higher-yielding assets.

Investors piled into safe haven assets, like the Japanese Yen and the Dollar, as concerns over global banks’ exposure to Dubai debt intensify.

AUD/USD, traded at a 0.9322 high, before declining over 350 points to a 0.8949 low.

The pair broke below its bullish daily trade line to drastically shift the near term bias. Unless a resolution emerges in Dubai we could see the pair consolidate and trend below the 0.9150 level.

The near term outlook has turned bearish as risk aversion looks strong and technical factors point to sustained downward or consolidating pressure. Preferred strategy looks to sell on rallies.

From current levels, 0.9000, the pair finds initial support at 0.8950, followed by 0.8900 (strong support) and 0.8866.

Above current levels (0.9000), the pair finds initial resistance at 0.9045, followed by 0.9135 (50.0% Fib.) and 0.9179.

TREND

Near Term: Bearish
Medium Term: Neutral
Long Term: Bullish

Trading levels in play:

Traders can look to sell on rallies to the 0.9135 and 0.9179 areas as new sellers may emerge. However, there are no solid trade recommendations at the moment for intraday moves.

DISCLAMER: The above post is for information only. Before making your investment decisions please acknowledge that the information provided herein should not be taken without your own individual assessment and extensive investigation, it should not be preempted as your own trading strategies, investment advice and/or trading portfolio.
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