AUD/USD Weekly Technical Report 3-7/12/2012

The bearish Butterfly Harmonic Pattern is still affecting the pair were it declined to reach the second target of the harmonic pattern. However, Stochastic and MACD are showing negative signals indicating the extension of the downside move toward the first extended target at 78.6% correction at 1.0370 and maybe 88.6% correction at 1.0355. Nevertheless, the risk-reward ratio is inappropriate especially as the extended targets of the pattern are close to the main ascending support, therefore we remain neutral.

The trading range for this week is among the key support at 1.0260 and key resistance at 1.0645.

The short term trend is to the downside targeting 0.9400 with steady daily closing below 1.0710.

Support 1.0410 1.0395 1.0370 1.0330 1.0260

Resistance 1.0485 1.0485 1.0505 1.0565 1.0590

Recommendation Based on the charts and explanations above, we remain neutral for now awaiting more confirmations for the next move