AUDUSD – A substantive break higher in the Australian Dollar has been met with aggressive forex trading crowd selling, and our contrarian view to sentiment favors further strength.
Trade Implications – AUDUSD: The Australian Dollar’s break above critical technical resistance at $1.0496 suggests this is the range breakout we’ve been waiting for, and indeed we’ve seen our Momentum2 system hold a long from $1.0472.
The preceding weeks of choppy AUDUSD price action has been quite frustrating—we were stopped out of both long and short positions at losses on several occasions. Yet the combination of the price breakout and the massive sentiment swing gives us reason to expect a continuation in Aussie Dollar strength, and we remain bullish as long as price remains above resistance-turned-support at $1.0496.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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