Important: This site uses New York Close Forex Charts so that each 24-hour session starts and ends at 5 pm EST. These charts are essential for trading price action.
I wrote about the AUDJPY last Wednesday.
The idea was quite simple: wait for a close below the short-term range support at 75.40 followed by a retest of the area as new resistance.
Step one was a close below 75.40, which Friday did without hesitation.
The second step was a retest of the 75.40 region as new resistance.
That’s occurring as I type this post.
But so far, we don’t have a reason to think 75.40 will hold as resistance. Sellers are doing their part up to this point, but will it continue?
We never know where a market is going.
However, we can use the clues it offers to determine what is likely.
One clue I use in every situation is the daily close at 5 pm EST.
If today closes the day below 75.40, the idea is intact. It would also give me a bit more confidence in my bearish outlook for AUDJPY.
That said, there are a few upcoming events that could decide the outcome here.
First up are retail sales at 9:30 pm EST. That’s just a few hours into Tuesday’s session that begins at 5 pm EST.
The second set of events include an RBA rate decision and statement at 12:30 am EST on Tuesday, followed by a presser five hours later.
As you can tell, the next 24 hours promise to be action-packed for a pair like AUDJPY.
I have no interest in trading the pair until I see where today closes. If it closes back above 75.40, there’s nothing more to discuss.
If it stays below 75.40, I will continue to look for a favorable short entry for a move to that key support zone around 73.00.
I’m in no hurry to add a black mark to a run like that.
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