- Last Candlesticks pattern: N/A
- Time of formation: N/A
- Trend bias: Up
- Last Candlesticks pattern: Hammer
- Time of formation: 4 Mar 2013
- Trend bias: Sideways
AUD/USD – 1.0352
Although aussie dropped again to as low as 1.0116, the quick rebound from there formed a ‘hammer’ candlestick bullish reversal pattern and yesterday’s white candlestick adds credence to this formation, suggesting a temporary low is formed there, hence consolidation with upside bias is seen for test of the Kijun-Sen (now at 1.0296), above there would bring test of 1.0340-45, however, a daily close above resistance at 1.0375-80 is needed to confirm this view and bring subsequent gain towards the Ichimoku cloud bottom (now at 1.0443) but reckon the upper Kumo (now at 1.0477) would limit upside.
On the downside, expect pullback to be limited to the Tenkan-Sen (now at 1.0228) and bring such a rebound. Only below 1.0188 (yesterday’s low) would defer and risk 1.0150 but only break of said support at 1.0116 would abort and signal the decline from 1.0625 top has resumed for further weakness to 1.0055-60 but still reckon psychological support at 1.0000 would limit downside and previous support at 0.9969 would hold from here.
Recommendation: Buy at 1.0230 for 1.0430 with stop below 1.0130
On the weekly chart, despite this week’s initial brief fall to 1.0116, as aussie found good support right at the Ichimoku cloud bottom and has rebounded quite strongly from there, suggesting low is possibly formed and consolidation with upside bias is seen for test of the Tenkan-Sen (now at 1.0357), then the Kijun-Sen (now at 1.0370) but a weekly close above the Kijun-Sen is needed to confirm a low has been formed, bring a stronger rebound to 1.0455-60, then 1.0500, however, price should falter below resistance at 1.0599.
On the downside, expect pullback to be limited to yesterday’s low of 1.0188 and bring such a rebound to aforesaid upside targets. Only break of said support at 1.0116 would suggest the fall from 1.0625 top is still in progress for retracement of early rise from 0.9581 to 1.0100-03 (50% Fibonacci retracement of 0.9581-1.0625), then towards psychological support at 1.0000, however, support at 0.9969 (just below 61.8% Fibonacci retracement of 0.9581-1.0625 at 0.9980) should remain intact.