0.80 target has been hit! Congratulations holders! Below is our setup for the pair AUD USD at the current position. The investment strategy is neutral - while a short position is held at exactly 0.80 tap, the possibility for the price to still reach the liquidity engineer a higher low or... the sell off begins. Watch this space.
Zone colour Master Key: Blue = Monthly Purple = weekly Orange = Daily Grey = 4hour Pink = 1 hour
The Aussie has now passed 0.76 hurdle first, using a a daily Fibonacci on the daily chart, the price levels of this very strong strength from the Australian Dollar, the Fibonacci retracement of 0.382% is a strong possibility which has now been proved as price action here tapped 0.772 zone and consolidated while still making higher lows - giving confidence of confluence here rising to the monthly imbalance.
The next Hurdle is 0.80 which is our target for the next 3-5 months. [this was the original plan]. The plan since the original analysis, price has been bullish and driving towards the .80 mark as expected. beating the analysis prediction at an early scenario by 1 week.
End of 2021 scenario hypothesis: However, with the year end - we will now look for two scenarios - 1. Price will revert back using the Fib retracement - looking at a new high low to form before a further bullish movement to the Aussie towards 0.80, where price will then encounter a sell off from the imbalance or use this is a mid way imbalance and continue to hold to 2022 around or above 0.80+ 2. Price will continue to flow with minimal setbacks with a high probability of a weaker USD - due to the stimulus and presidential change, with new reforms to boost the economy again tumbling the Dollar.
Now the trend is moving, looking to see a weak dollar maintained in 2021 so this will be great for the Aussie!! Remember any bearish news on the world will see a rush to the USD, however with the US attempting to remove the safehaven asset for investors, expect a good move for the Aussie to see bullish movements.
Monthly imbalances - Price has rejected the previous yearly lows of AUD USD at 0.55 to a $1.00 This zone is a powerful buying zone for positional holders like us for two reasons; 1. - Price is clearly making lower highs 2. - The wicks are closing bullish - suggesting the zone is a fractal buying imbalance for buyers.
AUD USD - weekly time frame imbalances The weekly imbalances in place have provided
Track the original idea: November 2020
Update using the daily timeframe
Multi time frame analysis; AUD USD - Daily
AUD USD - 4 hour
Fibonacci extension target is 0.80 at -0.786
Current sale to hedge the longs
SPX vs AUD USD The correlation of the SPX and the Aussie is a positive correlation when the SPX is bullish, this allows the AUD USD to remain bullish. With respect for USD purposes where the SPX becomes bearish from an imbalance or has a trend breather, the correlation becomes a sell imbalance for the SPX and AUD based upon the USD having the fundamental safe haven positional stance for investors.
Using Yields: Be aware of the Yields of the US05 - US20 Year, this can impact the SPX growth and AUD Bullish correlation.
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still holding shorts, looking for a further sale upon a rejection of the weekly retrace