With AUD/USD Australia printing disappointing economic reports and AUD/USD reaching an important resistance level, I say it's time for a reversal!
Since January we've been seeing Australia print one weak report after another, from its leading indices to the CPI, new home sales, house price index, and building approvals report.
Not only that, word from my forex friends is that the RBA will cut its interest rates again next week after reducing it by 50 basis points in the last two months. Of course, we can't forget that China printed a surprisingly weak GDP report early this year!
On the technical side, I'm hoping that Big Pippin's AUD/USD setup on the daily chart will play out like many of his other setups. The chart shows that AUD/USD is testing the 1.0750 handle, which was a good resistance level in September and October last year.
With risk appetite currently dominating the markets though, I'm placing my entry level right at the 1.0750 handle. I know I missed a good entry a couple of hours ago, but I believe that Australia's recent trade balance data can give the pair a boost back to the resistance level.
Here's my recipe for pips this week:
Enter at 1.0750, Tight stop loss at 1.0850 (above 1.0800 and weekly ATR area) with my first profit target still yet to be determined.
I'm also thinking of looking at the bigger picture and aiming for the stars. What if I short AUD/USD at 1.0750, put my stop loss above the record high near 1.1000 and aim for parity? That would yield me a nice 750 pips! Just a thought, of course.
So, what do you think of my trade idea? Do you think we're seeing the end of AUD/USD's rally? As always, don't hesitate to hit me up with any questions or concerns!
@Happy_pip Twitter
Playing with Comdolls Facebook page
Happy Pip Comdoll Corners
MeetPips.com
Chips, dips, and many many pips!
Leave A Comment
Please sign in to comment.