Forex: AUD/USD –low 1 pip from parity

FXstreet.com (London) - With the dollar taking centre stage at the end of this week, recording significant gains in a white wash move in the market, triggered by comments from Fed’s non voting member Posser in favour of calling back QE3 next month, The Aussie has tumbled to 1 pip away from parity, selling off through the 9 month low at a hole figure above parity.

The pair should be supported at the 200 day ma line longer term, but between there and here, there is scope for dipping ones toe below the figure, and further, where of course one might expect orders to be placed, but if breached and stop losses executed below, well traders may well set up to be targeting as low as the 0.9860 area as being the historic support zones in 2011 and 2013. On the upside, it will be very interesting to see how the market plays out over the course of next week after todays close before traders might cash in ahead of the weekend. However, any rallies to the upside may be limited while, as markets always do, try to push the barriers. If the pair cannot close above the last recent major support lines for the pair above 1.0230 or 1.2056, which were broken on the third attempt on the weekly chart, and now becomes resistance, then the bears may well have their lunch paid for by the bulls!