Thursday, August 26, 2010


On the daily chart AUDUSD formed a nice hammer with its dip to .8770 yesterday. This was near its short-term uptrend line from June which today comes in at .8763. .8781 was also the .382 retracement level of the move up from .8067 on May 25 to the Aug. 6 high at .9222.

I bought at .8836 after a nice solid close above the low on the three-hour chart with the positive divergence I wrote about yesterday. The pair touched a high earlier today of .8893 where it ran into price resistance. The 10-day SMA is at .8925; the 200 is at .8940. Those may well serve as resistance. If they don't, .9000, .9050 and .9080 are the next resistance levels. Should a move down begin again, the pair must break below .8740. Below that is .8715 and .8655/40 (July 19 low and 50% of June 7 to Aug. 6 rise).

Here's the 3-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.

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