AUD/USD Accelerates Decline Towards Support

AUD/USD (daily chart) as of October 23, 2012, has continued its fall from the 1.0400 resistance area, which was around the 50% Fibonacci retracement of the bearish run from the 1.0600 resistance region in mid-September to the 1.0150 support region in early October. The drop from 1.0400 has gone on to breakdown below the key 1.0320 intermediate support level, and has significantly accelerated its bearish push today to fall further towards a potential support retest of 1.0150. In the event that price continues its bearish stance with a further breakdown below 1.0150, AUD/USD could move towards parity (1.0000) as potential near-term support to the downside. To the upside, with any failure to stay below 1.0320, bullish resistance potentially resides once again around the 1.0400 and then 1.0600 key levels.

James Chen, CMT, Chief Technical Strategist, FX Solutions

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