On November 3rd, I wrote about a potentially bullish scenario for the AUDUSD.
The pair was breaking out of a wedge pattern at 0.7130.
Since then, the Australian dollar has rallied 300 pips.
You can see how AUDUSD has produced some nice stair-step price action over the last few weeks.
On top of that, buyers are working on a breakout above the 0.7410 level.
That’s the area I’ve written about several times.
Yesterday closed above it, and 0.7410 appears to be attracting a few buyers so far today.
However, given that this is Friday, I’d like to see a weekly close above 0.7410 before deciding whether or not to go long.
That will accomplish two things.
First, a weekly close above 0.7410 will be more confirming that a daily close.
And second, it keeps me from entering the market before the weekend.
I prefer to enter early in the week to avoid any weekend gaps that arise due to weekend volatility.
Additionally, today’s session, at least so far, is forming an inside candle.
Those familiar with how I trade inside candles know that it can be an effective continuation pattern.
That’s especially true following a key breakout.
If AUDUSD can hold above 0.7410 next week, there isn’t much to prevent a run at the 0.7740 resistance area.
Above that, the Australian dollar could target 0.8100 as we head into 2021.
Alternatively, a close back below 0.7410 would delay the bullish outlook and re-expose 0.7340 and perhaps 0.7230.
[thrive_custom_box title=”” style=”dark” type=”color” color=”#fef5c4″ border=”fadf98″]
Want to Watch the AUDUSD Video I Just Released to Members?
Get a Lifetime Membership Today and receive exclusive member-only content including one to two new videos every day. Save 40% in December!
[/thrive_custom_box]
