With AUDUSD holding a very weak bias over the long term, on a higher time frame swing we would like to respect that bias and look for adequate short entries. The market reversed at the lows at around .68500 after breaking out of the ascending pattern, below the and made a significant run to the upside. This brought a lot of buyers into the market. However with the market reversing sharply at the bottom of the at around .72400, that it had previously broken out of, and then forming a lower high at around .71400 we could potentially see the AUDUSD return to its long term bias and at the very least try to make a run to the previous lows.
If one wanted to look to get short please follow the rules below for an entry:
- Aggressively one could short this pull-back at around .70800 with a stop loss above the lower the lower high at around .71500-.71600.
- Alternatively for a more conservative approach one could drop down to the hourly chart and look for a pattern before taking on the position, stop placement will be the same as the more aggressive entry. This will not provide as good of a risk:reward ratio however.
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