Following the Chinese GDP Data, price fell below 1.29 primarily due to AUD weakening. Stochastic reading from the hourly chart is forming a sell signal with readings heading below 80.0 after staying in “Overbought” region as price attempt to reach 1.29 again. Failure to break back into 1.29 – 1.296 trading range adds onto bearish pressure towards 1.286 first, agreeing with what Stochastic is telling us.
Daily Chart suggest more of the same, with Daily Stoch readings heading lower. Some support could be found if one extrapolates the rising trendline. Break below current levels will open up 1.28 as potential support. Further support can be seen around 1.27. Unlike AUD/USD, Stochastic of both shorter and longer term aligns. Keep a keen watch on this pair for any confirmation of the 1.29 break on the daily chart for indication of strong bearish follow through.
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