Monday, October 18, 2010

AUDUSD—another attempt at the top

I'm long from .9841 and I took some partial profits at +60 pips.

Last week's high of 1.0003 was very short-lived—a quick spike at 8:15AM EST on Friday morning. That was still a 7th week with a higher high and higher low than the prior week and in only one of those seven weeks (the week before last) was there a quick lower low. So it's not enough to say the uptrend is over yet and I'd expect another test of parity. Another failure to close above parity would not be positive. The fact that it broke below a reasonably drawn uptrend channel is not good. A retest of that channel line is 1.0065 and since potential price targets are at that level from last week, it would probably present a short opportunity. There is negative divergence on the three-hour chart.

Support can be found at .9801, .9767, .9709, and the real line in the sand of .9542.

Here's a 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.

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