ICmarkets

AUD/USD: Weekly technical outlook and review.

FX:AUDUSD   Australian Dollar/U.S. Dollar
29 0 1
Weekly TF.

Price is still frustratingly trading within a weekly consolidation area with the upper limits seen at 0.94600, and the lower at 0.92046, with no signs of a break happening just yet.

Daily TF.

Last week saw buyers and sellers still trading within the medium-term daily range (0.92046-0.92354/0.93529). In spite of this, A spike/wick above the aforementioned 4hr range happened on Thursday, this wick likely cleared out any remaining sellers around this area, potentially clearing the path north up to around the daily supply area at 0.94729-0.94175.

4hr TF.

The selling pressure continued since price hit the 4hr supply area at 0.93866-0.93728 (and triggered our P.A confirmation sell level at 0.93711 in the process) on Thursday. A bullish reaction was seen around the 4hr minor R/S flip level at 0.93450, despite this, price continued on south down to around an important area of demand (well to us anyway) marked with a green arrow at 0.93279. For us to consider setting a pending sell order around the aforementioned 4hr supply area, a push below this low would have to be seen first, preferably without hitting the 4hr decision-point below it at 0.93053 where a P.A confirmation buy level is set just above at 0.93076.

If the low is consumed and no return is seen back up to the 4hr supply area, we’ll be watching two areas of demand for a reaction:

1. 0.93053, we’ve added a P.A confirmation buy level just above (in our opinion) this minor 4hr decision-point level at 0.93076. This area is likely where the ‘decision’ was made to break above the high 0.93450, so it remains important, however not as much as the 4hr decision-point level below it, hence only allocating a P.A confirmation buy level here for the time being.

2. 0.92785, we’ve added a pending buy order just above this level at 0.92807, this 4hr decision-point level is far more attractive since this was likely the overall origin of the entire rally higher, indicating that pro money may well just use the 4hr decision-point level at 0.93053 as a ‘dummy-fake’ level, in which to push price below to the aforementioned origin, thus attaining more liquidity in the process (sell stops from the traders attempting to fade, and not forgetting the breakout sellers’ order as well).

Pending/P.A confirmation levels:

• Pending buy orders (Green line) are seen just above a 4hr decision-point level (0.92785) at 0.92807. We have placed a pending buy order here because this level remains untouched, and Is effectively the overall origin of the rally higher, making this level high probability for a first-time reaction.
• P.A confirmation buy levels (Red line) are seen just above a 4hr decision-point level (0.93053) at 0.93076. The reason for not setting a pending buy order here is simply because we believe pro money may push below this level to the overall origin of the move up (4hr decision-point level at 0.92785).

• No pending sell orders (Green line) are seen in the current environment.
• The P.A confirmation sell level (Red line) set just below a 4hr supply (0.93866-0.93728) at 0.93711 is now active. The sellers will need to confirm this area by consuming some or most of the buyers around the low marked with a green arrow at 0.93279, we will then consider setting a pending sell order awaiting a possible return.


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