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AUDUSD pauses downtrend

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AUD/USD paused its decline and bounced from 0.8223 – a 4-year low – to 0.8374 by early Thursday. The doji candlestick formation on Tuesday represents indecision in the market and signals a potential rebound and a stall in the downtrend. This pause in the decline is also suggested by the RSI which is pointing back up and also the kijun-sen line is flattening out. A correction higher would test the key level at 0.8500. However the underlying trend remains bearish as the market is below the Ichimoku cloud which is falling. Also prices remains below the downtrend line from the 0.9400 high.

As long as prices remain below the 50% Fibonacci level at 0.8545 of the upleg from 0.6008 to 1.1078, the downside bias will be supported.

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