With the RBA meeting minutes coming out next week and the recent data from the USA I am expecting this currency pair to head back down to recent support levels. The RBA kept rates on hold in the last meeting but I expect them to leave the door open to further rate cuts and the December rate hike for the US is still on the table giving us some divergence on this pair.
Technical best price
As you can see from the chart the AUD/USD pulled back to the 7615 level due to stronger than expected Chinese CPI data last week. Oil is also supporting the risk sentiment in AUD which gave it a boost. However both these aspects are temporary and I expect them to subside. The recent pull back also highlights the 50% and 61.80% Fibonnaci retracement from the latest drop away from the declining trend line so Market price is a good place to start at 7615.
Trade Management
I have kept the stop loss tight in case we retest the declining trend line where I will re-enter the trade if stopped out. For now the recent rejection is enough for me to enter at market on Monday morning I am looking to take profit on a retest of the 7440 low but will look to move the stop loss to break even at the 7500 support as well.
You can see the weekly outlook video describing this trade on my website.
Look out for updates on this post
Trade closed: stop reached
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stop out of this trade I am now looking for rejection of the trend line I will post this as a new trade idea