AUD Futures: OI drops, adds credence to bullish exhaustion, traders await breakout

CME Group’s preliminary figures for open interest in AUD futures show a net drop of 812 contracts on Friday. The drop in the OI has been accompanied by a sharp drop in the futures volume. 

A long upper shadow of daily candles - Wed & Thu - shows bullish exhaustion around 0.7640 levels. Despite the broad based USD selling in the North American session on Friday, the spot failed around 0.7630 levels.  

Thus, a drop in the OI on Friday adds credence to the candles signalling bullish exhaustion. The sharp decline in the volumes - from 224,621 (Wed) to 108,507 (Fri), also signals the rally from the low of 0.7371 (Jan 2 low) has matured and the traders await a convincing break above the Friday’s high of 0.7636 levels. 

As of now, the spot is struggling to take out 0.7626 levels (resistance offered by the Top Line of the Bollinger Band - 50, 2).