justatrader

AUDUSD - Why its important to have the big picture in mind

FX:AUDUSD   Australian Dollar/U.S. Dollar
***Why do you need to have an idea on the bigger picture***

I've seen quite some trade ideas between my last Aussie chart and now. Some calling longs, some calling to stay out.. I must admit, at times even I got a bit confused, but this chart has kept me on the right side of the trade. For example, the retracement to 0.93065 was picture perfect. (It was a high of previous NFP which was waiting to be picked).

So the bias is still to the downside and short positions should be closed near 0.912 (there is some room to the downside but let's not get too greedy). Lot of US data today and tomorrow (starting with Aussie PPI early hours).

We're looking for a drop to 0.91023 - 0.91323... (therefore 0.912 because its round and sounds like a nice number between those two)

At current levels, there should be no reasons for RBA to take a dovish stand (If price hovers below 0.93 levels). If May's labour data for Aussie also comes out bullish , then we can head back to 0.95 levels. There's something more interesting happening at 0.95, which i'll update later on.

***Importance of referencing other pairs***

Check the linked EURAUD             chart, which shows that a bullish move is required for EURAUD             to confirm its bias to the downside. A retracement to 1.526 level or something. This points to an interim weakness in the Aussie to achieve that which coincides with the weakness in AUDUSD             to retrace to NFP & Aussie labour data highs couple of months ago.

Now combine AUDUSD             , EURAUD             and we can get a sense of direction EURUSD             must take for the analysis to come true, which in turn can help you understand if any sudden moves opposite to the trade is valid or just a temp. glitch.

Current risks: Refer to today's fundamentals from the US.
Next update: Post NFP

Good luck!!
Professional market analyst with a keen interest on futures. Love keeping an eye on the markets. Currencies, bonds, commodities. Combining technical analysis and the fundamentals. Contact me for more details.
jarthoben PRO
2 years ago
Agree.
Aussie also looking weak in EUR/AUD and really weak in AUD/CAD.
If the big data doesn't change the fundamental picture too much this week, I see a potential move down to sub 0.9000
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ForceFollower
2 years ago
What do those two arrows up above "May NFP" mean? A move up? You seem to expect a decline to .912, not a move up (although a move up is what I expect), right?
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jarthoben PRO
2 years ago
Also keep in mind the XAUUSD dropping also supporting a weaker Aussie...
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justatrader PRO jarthoben
2 years ago
Yes.. that was another beautiful story... Targeting 1211 at the moment.. unless FOMC changes market direction completely.
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I expect a drop to 0.912.
To pick up price between NFP released on 07/03 and Aussie labour data on 13/03.

So this completes a sort of retracement.. provided tomorrow's NFP comes out gray... (if its very bullish, then will need to revisit/re-analyze this chart again)

Gray = Modest increase



So after retracement is complete, +ve Aussie data (or weaker US data.. depending on what Yellen says today) should lift the pair back to 0.95 (and a notch higher)... this should make the RBA nervous enough to intervene and talk down the pair, which then fits in within the grand bearish trend of AUDUSD.

P.S: The Arrows are just indicators, not any sign of upward moves... Couldn't find a better icon. The smarter looking arrows (Green-Green-Red-Green) is what I expect AUDUSD would do.
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ForceFollower justatrader
2 years ago
I was confused. Now, I see. :-) It's just an icon.
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Aussie refuses to move... Next risk.. China Manufacturing PMI. HSBC Flash came out below expectations but managed to grow from 48 to 48.3.. Tomorrow's data likely to move Aussie pairs..
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ForceFollower
2 years ago
It was one of the most quiet FOMC announcements I can remember in my life. The decision was like a "no-decision", so no wonder fx prices hardly budged. Yes. waiting for tomorrow. And "tomorrow never dies". :-)
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Some interesting price action formation near 0.93 level.

snapshot
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