The Australian Dollar advanced against its US counterpart as expected after producing a bullish Piercing Line candlestick pattern. Prices overcame resistance at 0.8918, the 23.6% Fibonacci retracement, to challenge a falling trend line set from early December (now at 0.8974). A break above this barrier on a daily closing basis targets the 38.2% Fib at 0.9079. Alternatively, a move back below 0.8918 aims for the 14.6% retracement at 0.8819.
Risk/reward considerations argue against taking a trade at current levels with prices wedged tightly between relevant near-term support and resistance levels. We will opt to stand aside for now, waiting for the pair to yield a more attractive setup.