FX.co ★ AUD/USD Technical Analysis for September 5, 2011

Chart D1:

The AUD/USD currency pair has started long-term upward trend, with MACD above zero and its signal line. However, the stochastic oscillator is turning downwards below its signal line indicating current correction of the pair. Therefore, mid-term and intraday speculation on a rise may be profitable after a rebound.
Upward targets are to be calculated within the extension grid of 0.9709–1.1079–0.9928.
The Closest Resistance Levels:
- 1.0776 = extension 61.8%
- 1.1079 = the previous high
- 1.1300 = extension 100%
The support levels are to be calculated within the correction grid of 0.9928–1.0771.
Support Levels:
- 1.0449 = 38.2%
- 1.0350 = 50%
- 1.0250 = 61.8%
Overbought / Oversold Market (D1)
Detrended Price Oscillator (DPO) is below zero, indicating a sufficient rebound; therefore, it is recommended to take into consideration the upward trend and search entries for a rise.
Additional DPO support/resistance levels: overbought at and below - 1.0470; oversold at and above - 1.0770.

Chart Н4:

MACD is below zero and its signal line, therefore the AUD/USD pair forms a downward trend in the mid-term chart. The stochastic oscillator is also turned downward. The end of this downward trend signalizes a moment to open long-term positions on the largest trend.

Overbought / Oversold Market (H4)
Given the largest long-term upward trend, a below-zero position of the DPO indicator can be ignored as there is no signal for a mid-term trend’s rebound.
Additional DPO support/resistance levels: overbought at and below - 1.0560; oversold at and above - 1.0730.