ICmarkets

AUD/USD: Technical outlook and review.

FX:AUDUSD   Australian Dollar/U.S. Dollar
107 0 1
Weekly Timeframe: A full-bodied bearish candle has been seen closing below a long-term weekly consolidation area at 0.94600-0.92046. In our humble opinion, it appears there is very little obvious weekly demand until price reaches the weekly Quasimodo support level at 0.88189, which is beautifully located just above a weekly demand area at 0.86591-0.88247. Be that as it may, we should not discount the possibility a retest of the 0.92046 level (now resistance) may very well be seen sometime soon.

Daily Timeframe: The break recently seen below the daily demand area at 0.89942-0.90510 was initially thought to be a signal for lower prices down to around the daily Quasimodo support level at 0.88189, and this could still be the case. However, as we can all see it appears the break below stopped out a number of traders attempting to fade this area, these stops may have forced pro money to buy, since once the stops were filled, each one became a sell order, and pro money cannot drop prices by selling into sell orders! So, buying had to be seen before any decline in value was to be considered. It is very likely prices may rally a little further yet up to around the daily resistance flip level at 0.91323 before pro money can take prices south.

4hr Timeframe: We had initially set a price action confirmation buy level just above the round number 0.9 at 0.90081, this level has indeed been confirmed, but we will not be placing any pending buy orders in the market at this time. The reasoning behind this is simple, if price would have consumed the (which was at the time) 4hr decision-point area at 0.90673-0.90420 without hitting the round number 0.91 above, we would have without a doubt gone long around the round number 0.9, and thus targeted the round number 0.91 where price is currently seen reacting off of at the moment. We believe active buyers may come into the market around the 4hr supply flip area at 0.90673-0.90420, and push prices further north up to at least the 4hr resistance flip level at 0.91327 (we will be watching this level for price action confirmation upon arrival) which coincidentally lines up perfectly with the daily resistance flip level at 0.91323. From here we expect to see very active selling coming into the market.

Pending orders/Price action confirmation levels:

• Areas to watch for buy orders: Pending orders: No pending buy orders are seen in the current market environment. Price action confirmation levels: No price action confirmation buy levels are seen in the current market environment.

• Areas to watch for sell orders: Pending orders: No pending sell orders are seen in the current market environment. Price action confirmation levels: 0.91195 (Stop loss: Dependent on price action after the level has been confirmed, Take profit levels(s): Dependent on approaching price action after the level has been confirmed).
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