AUDUSD remains buoyant via a weaker US dollar and resilient US stock market, but a failure at 0.6627 could offer a high-conviction setup.
Watch today’s video for details, including how the US Dollar Index (DXY) and even the S&P 500 (SPX) will play a role in this potential AUDUSD trade idea.
AUDUSD is pulling back today after Friday’s session managed to hold above 0.6676.
It’s a level I discussed in Friday’s Weekly Forex Forecast video and one that is currently serving as support on a daily closing basis.
However, the much more significant level I’m watching is 0.6627, but not for the reasons you might think.
Yes, 0.6627 is the AUDUSD former range high, which should now serve as new support.
But for the way I trade, 0.6627 represents a short trigger.
If AUDUSD is forced back below 0.6627 on the daily time frame, it will signal a failed breakout (fakeout) and open up downside targets like 0.6450 range lows.
That said, the name of the game this week is patience.
I’m in no hurry to short AUDUSD without a confirmed break below 0.6627 and the DXY below both 104.52 and 105.00.
Additionally, the US stock market is trading at all-time highs and has shown tremendous resilience.
That’s helping to keep the Australian dollar well-bid, avoiding a sustained break back inside its previous range.
But my plan is set in case those bullish AUDUSD factors reverse this week.
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Thanks for sharing