AUD-USD: Although the pair is currently holding off downside weakness, while trading below its invalidated rising trend line, it looks to be heading to the downside, eyeing the 0.8943/04 level, its Nov. 27/Nov. 01 lows. An invalidation of there will neutralize its pattern of higher highs and higher lows and turn focus to its Oct. 01 high at 0.8857 and then the 0.8567 level, its Oct. 2 low.

Its daily studies are bearish and trending lower, supporting this view. In order for the pair to relieve its present downside vulnerability, a break and hold above its YTD high, residing at 0.9404, must be established to trigger the resumption of its medium-term uptrend toward the 0.9592 level, its July 27, 2008 high; subsequently would be the 0.9790 level, its July 20, 2008 high. On the whole, unless a sustained break above the 0.9321/0.9404 levels occurs, downside risk still exists toward the 0.8943/0.8904 levels.

Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces

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