Top 3 Currency Pairs Teeming With Profits

The pair has turned south, making our short position even more profitable earlier today. The pair is trading at around 1.3420 as we speak. Should the bears push the rate below the lower border of the green consolidation on a closing basis, we're likely to see further deterioration. A test of the recent lows, the 38.2% Fibonacci retracement, or even the lower line of the red declining trend channel is not out of the question in the coming days.

AUD/USD - Stabilizing at Support?

(Click on image to enlarge)

In our Tuesday's commentary on this pair, we have questioned how low can the bears bring the price down:

(...) How far down could the bears take the pair?

Actually, not that far it seems. Look at the lower border of the red declining trend channel and then the 70.7% Fibonacci retracement. Additionally, the RSI approached the level of 30, while the CCI and the Stochastic Oscillator moved to their oversold areas, increasing the probability of issuing buy signals in the following days.

The exchange rate went on to extend losses in the last few days and also broke below the lower border of the red declining trend channel on an intraday basis earlier today. The bulls have countered and the pair looks stabilized right now at the lower border of this trend channel.

This increases the likelihood of further improvements in the coming days. Additionally, the RSI flattened around the level of 30, the Stochastic Oscillator generated a buy signal, while the CCI keeps moving higher in its oversold area, increasing the probability of it also issuing a buy signal in the following days.

Connecting the dots, the downside momentum may be nearing its exhaustion. Should we see bullish signs such as a daily close comfortably above the lower border of the red declining trend channel and also a breakout above the brown declining resistance line, we'll consider opening long positions.

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