Today I’m going to show you a possible breakdown from AUDUSD that could open up a 200-pip opportunity.
I’ll also share the latest on the US Dollar Index (DXY), so you’ll have the latest information to trade the Australian dollar successfully.
Watch the video below and scroll down for the annotated charts and analysis.
AUDUSD is at risk of breaking a significant trend line support today at 0.6400.
That’s the trend line from the March 2020 COVID low, and one that could send the Australian dollar considerably lower if broken this week.
We saw the pair break the October 2022 trend line in August, and we I even mentioned it as a possible selling opportunity to DPA members.
Since then, AUDUSD has consolidated between the March 2020 trend line at 0.6400 and the 0.6490 horizontal level.
With the US Dollar Index (DXY) looking strong and equities vulnerable to a pullback, I like the idea of looking for AUDUSD shorts.
However, a confirmed break this week is critical.
A sustained break below 0.6400 opens up the 0.6290 low and also the 0.6170 2022 low.
That’s a considerable 200-pip opportunity from the Australian dollar.
But only if sellers can confirm the breakdown below the 0.6400 region.
Alternatively, a daily close above 0.6400 keeps support intact and the 0.6490 resistance level exposed.
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