AUD/USD: Partial profits booked on long position as .9200/20 resistance must be respected
If you remember back a couple of weeks, it was the break below .92 cents which accelerated the renewed bear push and I remember it well as I just managed to get out of my previous long position at this level. Luckily I bought back in near the lows and it would be very remiss of me not to book some partial profits now that we are re-testing these levels.
I see three potential short-term scenarios from this point:
- We top out near .9200/20 in short-term and get a re-test of the .9035/45 break-up point (my favoured option at this stage).
- Bulls show more strength and we see a solid march to .9300 before losing momentum.
- Either of these resistance levels hold and the bears break back below .8950 (the most unlikely option in my biased opinion).
Another factor to keep in mind is that, as of last Tuesday, AUD shorts were at 3-year record levels and once the short-covering begins, it will have some prolonged strength.