Daily Price Action
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AUDUSD Hits Key Resistance: Here’s What I’m Watching

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The AUDUSD has jumped above a critical level with today’s rally. The trend line that extends from the May 2015 high comes in near 0.7700 and was respected last Thursday with a bearish rejection candle.

While today’s break of the May 2015 trend line is significant, two things could pose a problem for the bulls.

So far this is only an intraday break.

As you may well know, I primarily trade the daily time frame. So any intraday break, particularly of a two-year level, is inconsequential.

Today’s high hit a significant resistance area.

I mentioned the confluence of resistance near 0.7740 in the February 9th commentary. This area is the intersection of the April 2016 trend line as well as the two swing highs from August and November of last year.

Now, here’s what I need to see before today’s close to suggest buyers have exhausted their resources (for now).

Because the trend line from the May 2015 high held as resistance last week and also capped yesterday’s rally, I need to see the pair close the day back below the 0.7700 handle.

I use a New York close chart, so that means the AUDUSD needs to close below 0.7700 before 5 pm EST. If it does, we could have a short setup on our hands either today or tomorrow pending bearish price action.

And if it doesn’t, I’ll stand aside and wait to see what happens in the 0.7740/60 region.

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AUDUSD possible short opportunity

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13 comments
Joe Gambill says

I’m tracking a Cup n Handle pattern on the 4-Hour chart with the lip @ 0.75257 starting on 12/14/2016.

I’ve calculated 365-PIP cup with a target of 0.78900.

What’s your take on this?

Reply
    Justin Bennett says

    Hi Joe, I don’t use that pattern nor would I attempt trading it on the intraday charts.

    Reply
      Joe Gambill says

      So do you truly only trade the 3 patterns in your LESSONS section : Head and Shoulders, Wedge and Flag?

      Reply
        Justin Bennett says

        Sure. I also (occasionally) trade double tops and bottoms.

        Reply
          Joe Gambill says

          I should re-focus then … 🙂

          Reply
    M. N. Barlas says

    Keeping in larger time frames 0.78900 seems to be a valid target. However depends upon closing price this month.

    Reply
Seetsaman says

i am thankful for what you do for us.
How do i put a new york close chart on my MT4?

Reply
    Justin Bennett says

    You’ll need to speak with your broker.

    Reply
Ertmeloi Sedrepzana says

Nice 4-Hour pin bar 🙂 Just like me learned.

Reply
philip says

Hi joe what I would do is wait till it breaks that 0.7740 and keeps going up and then wait for a 1h reversal candel and SELL AUD/USD what do you think?

Reply
Smart trader says

I think if the resistance(0.7777) that was established on the November- 8- 2016 is broken, their will be a continues trend to (0.81626)

Reply
    Justin Bennett says

    Friday’s close says otherwise, but we’ll have to wait and see.

    Reply
webar fx dan says

Nice analysis sold from 0.77250 my sl is at 0.77650 and my target 1 = 0.76650 – 0.76450 target 2= 0.75650 target 3= 0.75150

Reply
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