Although i don’t think things are as bad as the IMF is making out for the Australian economy, i do think our currency is heading lower and have mentioned this a number of times during the past week. The 0.7150 level is something of a line in the sand for the AUD/USD at present, and while we remain below this level the door remains open for retests of the 0.6950 level, and beyond that, 0.6750. At present the 50 and 100 DMA’s come in around the 0.6750/80 region and this also coincides with the late March lows.
The daily tech studies are not yet oversold and indicate we have further room to move on the downside, but the interesting one is the weekly AUD/USD chart which shows things could have run out of steam and are now on their way lower.
Look to sell at 0.7080 and 0.7130 with a stop above 0.7150, mine will remain at 0.7183. We will target the 0.6950 region but will be willing to cover if we fail again at the 0.7000 level.
