AUDUSD—broke below 100 SMA

AUDUSD broke below its 100 daily SMA (currently at .9075) and seems headed for the 200 at .8959. In doing this it has broken uptrend lines, downtrend lines that it had broken above, and a speed line as well as the.9135 bottom of April's trading range. Looks like the indecision that has plagued this (and many) pairs has been resolved into a fearful stampede. The low this morning has reached .9021 where it looks as though it's trying to bounce. If it should bounce one might see .9190 but don't hold your breath. One could try a long with a very tight stop since it's below April's low but be careful if you do so and lock in profits or at least move to breakeven as quiicky as possible. There is some positive divergence on the shorter-term charts.

Resistance is .9088. .9130/50, .9190, .9214, .9300, and .9364. Support is at .9002, .8959, .8927 and .8842. (.8842 is the point where two speed lines come together from Nov high and 2008 lows).

Here's the three-hour chart:













© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.