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AUD/CAD - key levels and outlook 9/1

AUD/CAD has been consolidating in the second half of August after sliding from around 1.01 to about 0.9760.

AUD/CAD 4H Chart 9/1


(click to enlarge)

Resistance around 0.99:
- As we can see in the 4H chart, the market has flattened the bearish swing. 
- AUD/CAD has been consolidating with a resistance just below 0.99.
- Note that around 0.99 is a support/resistance pivot zone. 
- Also, there is a 100-period simple moving average here.
- Finally, the RSI is near 60. If the prevailing bearish momentum is to remain, the RSI should stay below 60, or turn down briefly after tagging 60. 
- The 4H chart also shows a bearish engulfing candle as an initial reaction to the above-mentioned resistance factors. 

Bearish scenario: 
- There is really no clear trend for AUD/CAD, so we should limit the bearish outlook.
- The previous pivots at 0.98 and 0.9760 are viable and conservative targets respectively.
- An aggressive target would be down to a key support/resistance pivot around 0.96 (see daily chart below). 

Breakout scenario:
- Now if price breaks above 0.99, and the RSI pushes above 60, we are likely in a bullish continuation scenario.
- In the bullish continuation scenario, I would first look for resistance in the 0.9970-1.00 area.
- If price falls from this area, note that there would be a head and shoulder possibility in the daily chart, with the neckline at 0.9730-0.9760. . 
- If price can avoid coming back down to the neckline and anchor above 0.9870-0.99, then I would gain further confidence of upside risk towards the August high around 1.01 and maybe even the December 2015 high around 1.0165. 

AUD/CAD Daily Chart 9/1

(click to enlarge)