We finally saw some markets start to move today. Among them was GBPAUD putting in a 200 pip day.
As I type this, price is hovering around the 1.8222 level which we’ve discussed before. The level has previously acted as resistance forming the bearish pin bar on May 2nd (highlighted in blue below).
Since that time GBPAUD has made a higher low with price action looking extremely constructive at the moment. This leads me to believe that the 1.822 may not hold this time around, at least not in the long run.
Tomorrow should be interesting to see how the market reacts to this level.
GBPCAD also had a nice bullish day, closing up 80 pips from the open. Although much choppier than GBPAUD, this pair recently put in a nice bullish pin bar at the 1.818 support level.
At this point the current range is in tact, which means we could see a retest of the 1.856 resistance level in the coming days.
As a bonus I decided to throw the EURCAD into the mix. This pair is interesting because price is currently resting on a trend line from exactly one year ago (see second chart). The pair formed a bullish pin bar on the May 15th and has since consolidated.
Based on price action on the 4 hour chart, the EURCAD is starting to look fairly constructive for another push higher. The question is, how high? As seen from the chart below, the pair has been making lower lows and lower highs for the past two months. This makes it a bit harder to assess a target.
If the pair can get past the lows from early April around the 1.504 level, we may see a retest of the 1.53 level in the coming weeks. Of course all of this is contingent on the Euro finding its legs…
EURCAD one-year trend line
AUDUSD fell off a cliff today. There’s no other way to put it. The pair left no doubt that the uptrend which started earlier this year is over, at least for now.
From here, we should see the .922 level play a role going into the rest of the week. I personally won’t be looking for a long position any time soon. Instead I’d be more interested in playing a downside break and retest of .922 as a bearish trade setup.
As always, I’ll be on the sideline until we get a valid signal.