AUD / USD: Consolidation expected under 1.0260/70, well-defined entry points

After two months of pressure that led to the Australian dollar to its lowest against the dollar year-old Canadian, a bullish reversal is underway AUD / CAD. Exceeds the downtrend line followed by the withdrawal of 1.0136 Wednesday suggests that a significant low point has been made to support 0.9920/40 history last week (this area is defended by buyers from April 2011). With the decline of inflation in Canada this afternoon, of course now approaching 50% retracement of the previous bearish wave, which began in August. This level is 1.0260, which is the threshold below which of course failed twice in September before falling 0.9920. In the short term, the pair can therefore be difficult to overcome 1.0260 Given the current movement in 5 waves. from a low point last week. If you really sellers continue to defend the 1.0260 resistance, we can see the beginning of consolidation following Monday, leaving the possibility of a return to 1.0160/80 area in front of potential growth. Below 1.0160/80, it will always remain bearish slant which of course can then be based.

So there are two possible strategies for this pair at the moment. Sold aggressively at 1.0260/70 area with tight stops (15-20 pips) play potential correction 1.0160/80 area. It is expected that by the end of the hypothetical correction 1.0260 to put it at the checkout. Possible entry points are 1.0160 and 1.0140, and the targets will be 1.0320/40 1.0260/70 or extension.