The AUDUSD has been in rally mode since the start of 2017, gaining more than 500 pips in a relatively short period. And while this move is becoming a bit overstretched, I’m not so sure that buyers are ready to throw in the towel just yet.
At the moment, the 0.7608 handle is supporting the pair. This was the January 24th high and has more recently attracted buyers for three straight sessions. As long as this level holds on a daily closing basis, the bullish bias is intact.
But I’m not interested in buying the AUDUSD. Instead, I’ll be on the lookout for shorts near the 0.7750 area. As mentioned over the weekend, there is a confluence of resistance there thanks to the August and November highs from last year along with a trend line from the 2016 high.
On the flip side, should 0.7608 fall on a daily closing basis before the pair reaches 0.7750, I’ll begin to watch for selling opportunities. The next key support below that comes in at 0.7525 followed by 0.7450.
At the moment, however, I don’t have any reason to believe the AUDUSD is ready to reverse course. That’s okay with me as I would rather sell at higher prices, and the 0.7750 region looks to be the most promising area to do so.
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