AUD/USD Bulls on the Alert

Bulls have been making the running in AUD/USD but this is another market where a key reversal week was seen, in early May, which could encourage a better pullback phase.

• MONTHLY CHART
  The bull move here recently overcame resistance from a long term channel top projection. However, there is now potential resistance at an equality target, the 2001/2008 upmove measured off 0.6004 Oct-08 low, at 1.1080.
• WEEKLY CHART
  In common with some other FX charts there was an early May key reversal week, which sets up the possibility of a better corrective phase.
• DAILY CHARTThe bull trend remains intact so far but the key reversal week requires caution.First support has come from around a prior channel top, at 1.0500 now (also close to a 38.2% pullback, not shown).The next lines of defence are
  •the old trading range top starting at the 1.0253 Dec-10 high
  •the rising support line at 1.0150 currentlyBreaks of these latter would be a strong indication that a more prolonged setback was underway.

[For the complete and illustrated version of this and future Updates be sure to sign up at www.sevendaysahead.com]