The AUD/USD increased significantly and has managed to jump above the 0.7873 previous high and is almost to reach a very strong dynamic resistance. Remains to see how the rate will react when will reach the major resistance, a breakout is favored if the USDX will slip lower in the upcoming days. The Aussie has taken the lead as the dollar index plunged today and continues to stay much below some very important resistance levels.

We’ll see what will happen on the AUD/USD as the USDX has retested a very strong dynamic support, a drop below the 91.80 previous low will force the greenback to depreciate further versus all its rivals. The index was rejected by the 92.52 static resistance but has also dropped because the United States data have disappointed. The US PPI dropped by 0.1% in December even if the traders and the economists have expected to see a 0.2% increase, the Core PPI dropped as well by 0.1%, despite the 0.2% growth prediction, while the Unemployment Claims have increased unexpectedly in the previous week, the indicator was reported at 261K, much above the 246K estimate and versus the 250K in the former reading period.

The currency pair increased sharply today and is almost to touch the median line (ml) of the dark blue ascending pitchfork. A valid breakout will confirm a further increase, at least till the upper median line (UML) of the major black descending pitchfork. You should know that we have an important dynamic resistance at the first warning line (wl1) of the minor black descending pitchfork. Only a false breakout above the median line (ml) or above the warning line (wl1) followed by a minor drop will signal a corrective phase. Is premature to talk about another drop as long as the USDX is trading in the red and stays much below some important resistance levels.

Technically, AUD/USD is expected to climb much higher on the short term if will close the day on the median line (ml).