AUDUSD reached a new high this morning of 1.0495. This was the first of several price targets in a zone that extends to 1.0550/95. I've unloaded some longs but still have two positions. I'd expect a reaction between there and 1.0600. Note that some trend lines intersect near 1.0700. (I don't disregard old broken trend lines). There are additional price targets up to 1.1400. While it certainly would not achieve that soon, this currency is a bullish freight train. Since the low in 2008 of 6007, Aussie has gained 4,488 pips, a gain of 75%. One could have done far worse than to simply buy dips in this currency. Commodity currencies in general are strong.
There is negative divergence on the daily chart. However, daily candles are strong—they are not throwing off many upper shadows. If it were, it would be a hint the market is rejecting higher prices.
Support is at 1.0289/57.
Here's the daily chart:
© Dianne Fecteau, 2011. 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.