AUD/USD potential for a break higher – Commerzbank

In view of Karen Jones, Head of FICC Technical Analysis at Commerzbank, the pair stays poised for a potential break higher.

Key Quotes

“AUD/USD is consolidating tightly sideways and is well placed to break higher– the Elliott count on the daily chart is pointing to a .7570/.7490 retracement ahead of another upside attempt and we remain unable to rule out minor slippage into this band. However currently the market seems well supported by the 20 day ma at .7602”.

“Last week, the market eroded the 2013-2017 downtrend and cleared the .7645 Fibo resistance and in doing so has introduced scope to the .7778/.7850 2016 highs and the 38.2% retracement. Directly above here lies the 200 month ma at .7930. Very near term we would allow for a dip to .7470/.7490 ahead of further gains”.

“We suspect that prices will need to go sub 7435, the 55 day ma, to alleviate upside pressure and trigger losses to .7312/00 then .7161/64, the recent lows”.