0.7182/0.72 offers potential buy zone today, traders...
In wake of the RBA minutes emphasizing an on-hold policy stance, along with resurgent USD demand, the commodity currency tumbled lower in lock-step with declining stocks Tuesday. Extending losses from recent 0.73+ peaks, the H4 candles captured October’s opening level at 0.7229 and are currently seen hovering just north of the 0.72 handle.
0.72 is likely an interesting level for buyers this morning. On the weekly timeframe, you’ll see the 2017 yearly opening level at 0.7199 converges with the psychological number. Daily movement is also seen trading within the walls of a demand zone coming in at 0.7164-0.7224. Further adding to this, we also have a H4 Quasimodo support seen positioned nearby at 0.7182 and a possible divergence play out of the RSI indicator.
Areas of consideration:
Keeping it Simple Simon this morning, all three timeframes point to a possible recovery move off 0.72ish today. The area between the H4 Quasimodo support mentioned above at 0.7182 and the round number 0.72 (green) is, according to the overall market picture, considered a high-probability reversal zone.
Conservative traders may opt to wait and see how H4 price action behaves before pulling the trigger. A bullish candlestick formation would help confirm buyer interest, and also provide entry/stop parameters. Aggressive traders, on the other hand, may have eyes on 0.72 as an entry point with stop-loss orders planted a few pips beyond 0.7182. That’s a 20-pip stop (including spread), which offers nearly a 1:1:5 move to the underside of October’s opening level at 0.7229 (initial take-profit target) in terms of risk/reward.
Today’s data points: US core durable goods orders m/m; US revised UoM consumer sentiment.
0.72 is likely an interesting level for buyers this morning. On the weekly timeframe, you’ll see the 2017 yearly opening level at 0.7199 converges with the psychological number. Daily movement is also seen trading within the walls of a demand zone coming in at 0.7164-0.7224. Further adding to this, we also have a H4 Quasimodo support seen positioned nearby at 0.7182 and a possible divergence play out of the RSI indicator.
Areas of consideration:
Keeping it Simple Simon this morning, all three timeframes point to a possible recovery move off 0.72ish today. The area between the H4 Quasimodo support mentioned above at 0.7182 and the round number 0.72 (green) is, according to the overall market picture, considered a high-probability reversal zone.
Conservative traders may opt to wait and see how H4 price action behaves before pulling the trigger. A bullish candlestick formation would help confirm buyer interest, and also provide entry/stop parameters. Aggressive traders, on the other hand, may have eyes on 0.72 as an entry point with stop-loss orders planted a few pips beyond 0.7182. That’s a 20-pip stop (including spread), which offers nearly a 1:1:5 move to the underside of October’s opening level at 0.7229 (initial take-profit target) in terms of risk/reward.
Today’s data points: US core durable goods orders m/m; US revised UoM consumer sentiment.
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