Today I’m going to show you exactly how I’m trading AUDUSD this week.
Check out the AUDUSD video below and scroll down for the annotated charts and analysis.
The AUDUSD is trading below a key horizontal level today at 0.6785.
That’s the former range top between March and May and a must-hold level for bulls.
However, instead of shorting today’s move, I will wait to see where today’s session closes at 5 pm EST before acting.
A daily close above 0.6785 keeps the level intact as support.
Alternatively, a daily close below 0.6785 confirms the fakeout and flips the level to resistance.
If you saw Saturday’s Weekly Forex Forecast, you’re probably already short AUDUSD.
In that video, I said a daily close below 0.6870 this week would confirm a mini fakeout and send the Australian dollar back to 0.6785.
That was the first sign of weakness from AUDUSD this week.
The second sign of weakness would be a sustained break below 0.6785 on the higher time frames.
But the jury is out until today’s session closes at 5 pm EST.
A sustained break below 0.6785 exposes the 0.6585 range lows, while a close above the key level keeps it intact as support, where 0.6870 is resistance.
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