During the course of yesterday’s sessions the commodity currency continued to drive lower, down from Wednesday’s peak at 0.7299. Mid-way through the London session, however, the Aussie clocked a new low of 0.7201, connecting with H4 channel support (0.7148) and just missing the 0.72 handle.
Now, given that weekly bulls appear to be having a little trouble pushing higher from weekly demand at 0.7108-0.7186, and daily price is currently trading from daily supply at 0.7366-0.7287, where do we go from here? Well, to our way of seeing things price could head in either direction!
Our suggestions: Although the aforementioned weekly demand appears to be struggling, it has yet to be consumed so it is certainly not an area we can ignore. Therefore, should this market close above H4 resistance at 0.7241 (potentially suggesting strength from weekly bulls), there’s very little H4 resistance seen until the 0.73 handle. For this to become a tradable setup for us, nevertheless, price would need to retest this line as support and chalk up a lower timeframe buy signal. Of course, do keep in mind that by entering long from here you’re effectively buying into daily supply, but trading in-line with weekly flow.
On the flip side, if price closes below the 0.72 handle, the next downside targets on the H4 fall in at the H4 trendline support (0.6863) and the H4 Quasimodo support coming in at 0.7145 (sits just above daily demand at 0.7108-0.7140 – the next downside target on this timeframe). As such, a break below and retest of 0.72 (alongside a lower timeframe sell setup) would be a valid trade signal to our team. By shorting from here you would potentially be selling against weekly buyers, but trading in-line with daily flow (please see the top of this report for ideas on how to trade lower timeframe confirming setups).
On a final note, technicals usually fly out of the window once the NFP takes the stage so please remain vigilant during this time!
Levels to watch/live orders:
• Buys: Watch for price to consume 0.7241 and then look to trade any retest seen thereafter (lower timeframe confirmation required).
• Sells: Watch for price to consume 0.72 and then look to trade any retest seen thereafter (lower timeframe confirmation required).
Now, given that weekly bulls appear to be having a little trouble pushing higher from weekly demand at 0.7108-0.7186, and daily price is currently trading from daily supply at 0.7366-0.7287, where do we go from here? Well, to our way of seeing things price could head in either direction!
Our suggestions: Although the aforementioned weekly demand appears to be struggling, it has yet to be consumed so it is certainly not an area we can ignore. Therefore, should this market close above H4 resistance at 0.7241 (potentially suggesting strength from weekly bulls), there’s very little H4 resistance seen until the 0.73 handle. For this to become a tradable setup for us, nevertheless, price would need to retest this line as support and chalk up a lower timeframe buy signal. Of course, do keep in mind that by entering long from here you’re effectively buying into daily supply, but trading in-line with weekly flow.
On the flip side, if price closes below the 0.72 handle, the next downside targets on the H4 fall in at the H4 trendline support (0.6863) and the H4 Quasimodo support coming in at 0.7145 (sits just above daily demand at 0.7108-0.7140 – the next downside target on this timeframe). As such, a break below and retest of 0.72 (alongside a lower timeframe sell setup) would be a valid trade signal to our team. By shorting from here you would potentially be selling against weekly buyers, but trading in-line with daily flow (please see the top of this report for ideas on how to trade lower timeframe confirming setups).
On a final note, technicals usually fly out of the window once the NFP takes the stage so please remain vigilant during this time!
Levels to watch/live orders:
• Buys: Watch for price to consume 0.7241 and then look to trade any retest seen thereafter (lower timeframe confirmation required).
• Sells: Watch for price to consume 0.72 and then look to trade any retest seen thereafter (lower timeframe confirmation required).
IC Markets is an online forex broker specialized in providing transparent trading solutions to both retail and institutional investors alike. We provide superior execution technology, lower spreads and unrivaled liquidity.