AUD/USD's inability to follow-through after the break of the resistance at 0.9394 casts doubts on the short-term double-bottom formation. Monitor the hourly support at 0.9353 (19/11/2013 low) as a break would likely mean the end of the current bounce.
A potential medium-term bearish head and shoulder formation could be underway with a neckline at 0.9281.
The long-term technical pattern remains negative thus far. Therefore, we see the recent decline near the strong resistance at 0.9792 (03/06/2013 high, see also the 200 day moving average) as the start of a new phase of weakness for AUD/USD. A test of the support area between 0.8848 (05/08/2013 low) and 0.8893 (28/08/2013 low) is our most conservative longterm downside risk.
Daily Technical Report
