What's interesting to me about this pair is it's now tiptoeing back into a range I blogged about in detail on June 17 of .8582 to .8674. The low so far this morning has been .8642. That post is at:
(http://forexreflections.blogspot.com/2010/06/audusdyesterdays-behavior-post-mortem.html)
It also broke below its short-term downtrend line from early June and .8737 was roughly the area that held price yesterday. (50% of the move from .9406 to .8067). At best the pair is unstable; at worst, a bigger correction is starting up.
I will probably look to sell rallies, possibly to the short-term uptrend line at .8703, if momentum stays weak as I believe a move back to the confirmation point of the double bottom at .8551 might be in the cards. The rounding top of yesterday's price action on the hourly chart is often a continuation pattern. On the other hand we still have the price potential of the double bottom at .9030 and there's slight positive divergence on the hourly chart.
Once again, this pair requires patience for an entry.
Here's the hourly 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.
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