AUD/USD

Commodity currencies had a strong run since the beginning of 2009. With the help of metals, agriculture and mineral prices going higher Canadian, Australian and New Zealand dollar gained strength against U.S. dollar. Australian dollar reached 1.1 levels in May 2011. However, since then we have seen the commodity currencies entering into sideways corrections. Choppy price action around the 200-day moving average formed a year-long symmetrical triangle on the AUD/USD chart. In the beginning of August, Australian dollar found resistance at 1.06 which is the upper boundary of the consolidation range. Over the past month AUD/USD moved lower towards the 200-day moving average at 1.025. The consolidation pattern is not completed yet. We are likely to see further weakness in AUD towards 1.00 levels. The real price action and the directional movement will take place once we see the major breakout from the year-long consolidation range.