This pair have been in an ascending channel since Sept 2016 and now price is at a major area of confluence, between the 61.8% and 50% fib of the last move down in the channel and now we're sat in a Bullish edge, waiting to explode up to complete the move to the top of the channel, so why the hell am I short this pair?
There is a smaller channel within the long term channel where the upside has not been completed due to lack of volume, and looking at the whole channel on almost every time frame, we have declining volumes and RSI while the move went higher, the bulls have ran out of steam and it's time to go back down, this has been confirmed by a cross of the moving averages before the last move up.
So the options are simple, either wait for the breakout to either the upside or downside and take your position, or if you want to go short, the higher risk option, take a position around @1.09350 with your stops above previous structure @1.09500 and target the 50% and 61.8% retracements @1.08200 & @1.07800
Let me know when you have opened your position and where, including your margin percentage and if you have another opinion, I'm love critisicism
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Look at that divergence on the way up, a bearish signal if I ever saw one, what do you think?
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We've just had a big move down inside the wedge, it broke the downside levels within RSI, another signal of a bearish move, especially on 1H timeframe, hopefully we don't make it back up and just break down, in which case, please your trade as it breaks out and pulls back to test the levels, or higher risk, do it now with a much higher stop above the wedge. *HIGH RISK
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Hmm , on the daily it's not looking amazing now, the candles are screaming bullish wedge
Trade closed manually
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I'm no longer confident on this trade guys, the Aussie is looking very strong, trade closed
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And there we go, when something doesn't look right, important to have the confidence to say so, it's broken to the upside, will it hold on the pullback, let's see, if it does, with the two try rule, maybe we can be a Bull?
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First pullback held, bulls went for a second try, and held, two try rule successful with higher lows, another pullback and you can become a buyer with a target @1.11
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We've now confirmed a move to the upside, creating a rising channel out of the wedge and using yesterdays close as support.
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We've broken out of the bullish channel on our way to a bullish target.
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I am now short after seeing the following signals and patterns, it's taken some time, but I'm happy with how this has unfolded.
The spike from our bullish wedge has not been rejected and formed a rising wedge, this is a reversal pattern and the divergence on 4h could not be clearer.
I have marked my targets and stop.
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We have now broken down out of the wedge, the target is acquired, I will be holding this until early next week. Setting up nicely and a reasonable reward.
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Why am I still short the Aussie v the Kwi when the Aussie is the stronger currency when looked at from the currency index perspective in a basket of global currencies?
Simple answer, short term, it's a short.... short term! Look at the RSI on the 15m chart, constantly declining even after the oversold spikes when the bulls attempted to push it higher, and now we're at the key support level below @1.091, which is below the previous point of control at 1.092, if we gap down below that support, we're going down to the next fib level at 1.087
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The Aussie is impacted by monetary and economic policy (inflation), agriculture and commodity and metal prices. Right now, Oil, Gold and Iron ore are on the decline, Crude oil futures fell when Russia and Saudi Arabia hinted that they were considering increasing production in an effort to control prices and the Kiwi $ had some positive news in response to Tourism numbers. This week, I'm short the Aussie!
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A reasonable start into the Asian open with a nice bearish candle rejecting 1.09300, now we want to see that support broken below us @1.09100
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Everything is progressing as forecast and with that long wick on the candle, we can expect another move down.
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The bears are accelerating, each bearish candle increasing in size and volume, we're going to hit our target no problem
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We're tracking nicely down this channel towards 1.085 - 1.08
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Turned into a lovely trade this one, despite the bullishness at the beginning, nice Bull trap. I have little doubt we'll reach the first target @1.05825
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The first target @1.085 is market on the chart below, look at the candle rejecting the 1.088 price at the moving average, which all three are crossing over telling me this is a trend change (in this time frame), 1.085 will act as a magnet sucking the price down to it, I will then review the bull's reaction to whether I take any profits, but I recommend you do.
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My actual long-term target is the 50% fib level down at 1.076, if you've seen any of my previous trades, you'll know I like a long-term patient target, but this one is not a solid target. Iron-Ore and Oil are down, this will have a direct impact on the Aussie, so for now, we're short, maybe longer than normal.
Letting my profits run is how I've grown my account over 800%, and learning when to take some profits too, so if you feel you need to take 50%, do it, less risk and free trades is a thing of beauty in this game.
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What are your thoughts on this pair?
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Did you take profits at 1.085, I'm expecting a bounce at that level. How far back do we retrace or straight back to the highs, will look at the analysis and forecast today
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The Aussie is the slightly stronger currency of the pair today, and their now battling it out over 1.08800
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Is a H&S pattern forming? The options are:
1. No H&S, wait for the pull-back to retest 1.085 and a possible move down to 1.08 / 1.076.
2. Yes. H&S forming. Take profits now, buy up to the right shoulder and then sell all the way down again, then point 1, post formed H&S.
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The trade has tracked this potential right shoulder uptrend perfectly and now we're retesting the 1.089, if that breaks, then I suggest buying taking profits and then sell again from 1.094, but something to think on, volume is delining.
Tonight we have Aussie building approvals with a forecast of negative news, that would weaken the Aussie further against the Kiwi and therefore potentially, send it back down to the lows. So buying it back up is not an option, we may not reach the high before then.
Remember, how you trade and take profits, is your responsibility and subject to your own rules and targets.
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It's pulling back to yesterdays close @1.08750 so if you've not taken profits and are unhappy with further risk, this will be the opportunity to take profits.
Trade closed manually
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I've taken profits on the pullback.... First time I've got no positions overnight in a month. But over 1000% profit growth in May, very happy.
Thanks for following my trades.
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Disappointed I exited the trade when I never really believed in it going back up, I was physically tired, goes to show how important mindset and being physically on your game is. I'm now well rested and following this pair with interest.
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Selling
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With oil still sitting around $66, and Copper and Iron Ore below or near yearly lows, this is going to have a NEGATIVE impact on the Aussie $. But ultimately, both currencies are moving sideways on the daily, with a long-term bull bias on the Aussie.
The pair have reached 61.8% fib on this move up the channel and have bounced off the moving average and as far as I'm concerned, the next target for the trade is 1.08. There really isn't the volume to support a big bull push this week. But never say never.
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If you aren't in this trade, I would wait for a good pullback and a price action signal to join. The Aussie still has a lot of bulls around the support area's, but we've broken through it already, can't be that hard to move south, may take a while
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This is the sell zone, stops above the red box.
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Despite the bullish moves, there is declining volume and divergence, a bearish signal, look at the RSI on 1H
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Testing 1.084, then we're off down to the real targets at 1.08 and below
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Not only is the Aussie weaker, but the Kiwi is much stronger, hence the drop towards our targets.
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You can see clearly here the target, long-term support, the moving average and the edge of the ascending channel. There are lots of negative issues with the Aussie right now in terms of commodity pricing which will impact the currency and the Kiwi has had good economic reports recently. Smashing through the channel would be nice, but unlikely since these two are so tight in the way they move and the long term trend is bullish.
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Not long now, this is your target approaching
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Still waiting for the last little greedy drop to 1.08, it's sat on some previous support.
Looking at the weighted average, there is no reason why we shouldn't hit the target, there is also no shame in taking your profits now.
Trade closed: target reached
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We're nearly there, but the Aussie is rising on the weighted average, I'm taking profits and focussing on my other trades. Well done everyone. nice trade.
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Sell order hit 23:40 at pull back into the red zone @1.08100, wait for a pullback into the green line or the red zone to sell it down.
Targets zone the 50% fib area: 1.07490 - 260 and then down to 61.8% @1.06710
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The Kiwi$ is declining, but not as fast as the Aussie, which has fallen down with the Yen, another piece of supporting information to remain bearish today.
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That'll teach me for trading at the low, it's good to receive a smack in the mouth in trading, best way to learn, Sell high buy low, at the right place
Trade closed: stop reached
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Today will be one of those days when trades are trying to find their levels, break levels and support new trends, you can see this in the aggressive moves happening very quickly.
It's incredibly important you stay patient for an entry, don't enter to just be in the market and if you've got a trade on a long-term, swing trade, be prepared to see larger sideways movements and therefore don't sit and watch them, don't enter with anything less than a 15m timeframe and preferable a 1h.
The Aussie is incredibly strong right now and against the Kiwi, we've hit the edge of the rising channel and will start back-up towards the highs, looking to take a buy position on this pair today.
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This trade unfolded beautifully to the downside leg of the channel and the longer term view is here.
Great analysis, thanks. I am short from 1.0938. Love the divergence. Price has been under the daily pivot all day today and only just pushed above this hour. Let's see how far it gets. Thanks again.
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@Sapphira, The Point of Control has held pretty solid for the last few days, subsequently the volumes have started to decline nicely and the bulls have had many runs at breaking the highs which will benefit us.