The aussie has continued its bullish rally and reached the support and resistance level of the previous highs at 1.0756. It will probably fall from here in imitation of past action. There is also a head and shoulders pattern at the highs on the 30min chart, also indicating further downside. A break of the neckline at 1.0678 would probably result in a move down to 1.0634 as an immediate target. Given the overall bullish outlook, however, the exchange rate could recover, and a break above 1.0730 leading to a re-touch of the 1.0756 highs.

Analysis prepared by:

Joaquin Monfort
Forex4you analyst