Interesting action seen on the AUD/USD...
The commodity currency rallied for a fourth consecutive day on Wednesday, reaching a high of 0.7685. The move has brought the current weekly candle up to within striking distance of the weekly trendline resistance drawn from the high 0.7835. Should the unit breach this line, however, the bulls won’t have far to go to find trouble since there’s a nearby weekly supply sitting a few pips above at 0.7849-0.7752.
Looking down to the daily chart, the next upside target does not come into view until we reach 0.7719: a Quasimodo resistance line that’s positioned just above the said weekly trendline. What’s also interesting on this scale is the AB=CD formation currently setting up (black arrows) that terminates around the underside of the weekly supply mentioned above at 0.7752.
Across on the H4 candles, the buyers and sellers are currently seen battling it out around a H4 resistance level at 0.7676/July’s opening level at 0.7680. The next port of call beyond these two barriers is the 0.77 handle, which is positioned a few pips below the aforementioned weekly trendline resistance.
Our suggestions: As of current price, we have no immediate trade recommendation. However, we really like the look of the daily AB=CD pattern given where it completes. To that end, we feel the bulls will continue to push this market higher today, with the likelihood of the 0.77 handle being consumed. We must be clear here though that we have no interest in trading this market UNTIL price has connected with the 0.7750 neighborhood (stops would likely be positioned above the high formed back on the 8th Nov 2016 at 0.7778).
Data points to consider: US PPI figures and US Weekly unemployment claims at 1.30pm, Fed Chair Yellen testifies at 3pm, FOMC member Evans speaks at 4.30pm, FOMC member Brainard speaks at 6pm GMT+1.
Looking down to the daily chart, the next upside target does not come into view until we reach 0.7719: a Quasimodo resistance line that’s positioned just above the said weekly trendline. What’s also interesting on this scale is the AB=CD formation currently setting up (black arrows) that terminates around the underside of the weekly supply mentioned above at 0.7752.
Across on the H4 candles, the buyers and sellers are currently seen battling it out around a H4 resistance level at 0.7676/July’s opening level at 0.7680. The next port of call beyond these two barriers is the 0.77 handle, which is positioned a few pips below the aforementioned weekly trendline resistance.
Our suggestions: As of current price, we have no immediate trade recommendation. However, we really like the look of the daily AB=CD pattern given where it completes. To that end, we feel the bulls will continue to push this market higher today, with the likelihood of the 0.77 handle being consumed. We must be clear here though that we have no interest in trading this market UNTIL price has connected with the 0.7750 neighborhood (stops would likely be positioned above the high formed back on the 8th Nov 2016 at 0.7778).
Data points to consider: US PPI figures and US Weekly unemployment claims at 1.30pm, Fed Chair Yellen testifies at 3pm, FOMC member Evans speaks at 4.30pm, FOMC member Brainard speaks at 6pm GMT+1.
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