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AUDUSD coiling up within potential Bearish Wedge

 

Within this messy pattern I do see potential for modest new highs before losses resume but, as always, comes down to a question of timing. 




Technically I see potential for a Bearish Wedge formation to materialise, which would project an initial target around the 0.7598 base. Price behaviour is certainly reminiscent of a correction with wild whipsaws which ricochet between key levels, whilst coiling up yet gaining little ground at the same time.

I havepreviously outlined a technical bias for a base to form above 93 on the US Index which, if successful, should help keep any AUD gains limited whilst the Bearish Wedge plays out.

With so many whipsaws present on the intraday timeframes then I suspect there is always chance for 'one more high' on the Aussie before losses continue. Greece is certainly hogging the headlines again this week and, if by some miracle a deal is struck this should weigh down on USD and help support AUD to send it higher. 

This behaviour can make it very difficult to trade the actual pattern which is why we then need to refer to the calendar to seek potential catalysts.

Areas of resistance I would seek signs of weakness to fade into are the 0.785-88 zone. Whilst I have outlined a potential resistance zone around 0.794 I would consider this too high to play along with the Bearish Wedge formation (if gains are too direct) so would prefer to stand aside. 





Domestically there is no high volatility news scheduled for Australia, so we have to look at China and US to provide any scheduled movements. China PMI, if soft enough, could see direct losses for the Aussie which would then be extended if backed up by further US strength. 
 



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