Interesting P.A being seen on the Aussie at the moment...
Kicking off our analysis this morning with a peek at the weekly chart shows the Aussie has recently drove into the jaws of demand fixed between 0.6935-0.7046. Could this be enough to stop this 2016 sell-off we’re seeing at the moment? Well, it could well be, as down in the pits of the daily timeframe price is trading within touching distance of a major support level coming in at 0.7035. In addition to it being a previously respected number in this market, it’s also joined together with an AB=CD bull pattern completion point which could heighten the odds of a bounce from here.
Looking to the H4 chart, nevertheless, we can see that price has now tested bids at H4 demand taken from 0.7040-0.7053. If it was not for the above said daily support level lurking just below here we would look to trade this demand. Risking money at this zone, however, with such a huge level looming below is not something we’d label high probability – a fakeout is highly likely.
Given the above, our focus today will be on the 0.7035 hurdle. Blindly trading this level (setting a pending buy order) might not be the best path to take (even though it’s bolstered by weekly demand at 0.6935-0.7046) due to the sheer velocity of selling being seen at present. That being the case, we have placed an alert at this daily barrier, once/if triggered, we’ll then being looking for lower timeframe buy entries into this market.
Looking to the H4 chart, nevertheless, we can see that price has now tested bids at H4 demand taken from 0.7040-0.7053. If it was not for the above said daily support level lurking just below here we would look to trade this demand. Risking money at this zone, however, with such a huge level looming below is not something we’d label high probability – a fakeout is highly likely.
Given the above, our focus today will be on the 0.7035 hurdle. Blindly trading this level (setting a pending buy order) might not be the best path to take (even though it’s bolstered by weekly demand at 0.6935-0.7046) due to the sheer velocity of selling being seen at present. That being the case, we have placed an alert at this daily barrier, once/if triggered, we’ll then being looking for lower timeframe buy entries into this market.
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.