There has been no question that the Australian Dollar is trading in a long-term downtrend against the US Dollar since the pair broke below the 2.5 year low in June of 2013. AUD/USD then continued to set new 3-year lows in
Looking at a daily chart, we see that when the Aussie broke out of the second leg of the downtrend, the pair continued to trade in a less shallow downtrend around the start of the New Year. But that down trend was also broken earlier this month, when a period of sideways trading unconvincingly brought the pair above the upper channel.
Although AUD/USD continues to trade above the upper trend channel, the pair tested and failed to break above the 2-month high at .9086, which may scare traders away from trying to place bets on AUD/USD rising further. On a 4 hour chart below, we also find an upward trend line from early February that may continue to provide support, and the 2-month high at .9086 in January may continue to provide resistance.
Traders looking to short the Aussie against the greenback should wait for a convincing daily close below support by the upward trendline, while those expecting a further pullback to the long-term downward trendline from the weekly chart should wait for a daily close above the January high.