Fantastic buy at 0.75 - strong confluence.
Kicking this morning’s report off with a quick look at the weekly timeframe, we can see that weekly price looks poised to attack a nice-looking weekly AB=CD (see black arrows) 161.8% Fib ext. point at 0.7496. Not only does this line merge with a weekly 50.0% value at 0.7475 taken from the high 0.8125, it’s also bolstered by a weekly channel support extended from the low 0.6827.
Down on the daily picture, the market has been busy painting red candles since the week’s opening. The next downside target on the daily scale can be seen at 0.7532: 21/11/17 low, followed closely by daily support fixed at 0.7505.
Looking across to the H4 timeframe, H4 price came within a few pips of retesting the underside of the 0.76 handle on Wednesday, before aggressively pressing lower. The move, as you can see, managed to marginally whipsaw through local H4 support at 0.7555 (see black arrow). As far as we’re concerned, this was sufficient enough to wipe out buyers and trap breakout sellers to clear the path south down to the H4 Quasimodo support planted at 0.7536.
Suggestions: Although the H4 Quasimodo support at 0.7536 may bounce price, it is not a level we’d trade. This is largely due to the 0.75 handle (not seen on the chart) boasting so much confluence and, therefore, likely to be the better buy zone. Just to recap, 0.75 boasts not only the aforementioned weekly structures; it also merges with a daily support mentioned above at 0.7505.
On account of the above, we will, dependent on the time of day (news), be looking to buy 0.75, with stops positioned 50-70 pips below. This should provide the trade enough breathing room, as this could potentially be a long-term trade with great risk/reward.
Data points to consider: AUD private capital expenditure q/q and building approvals m/m at 12.30am; Chinese manufacturing PMI at 1am; US unemployment claims at 1.30pm; US core PCE index m/m; US Chicago PMI at 2.45pm; FOMC member Quarles speaks at 5.30pm; FOMC member Kaplan speaks at 6pm GMT.
Down on the daily picture, the market has been busy painting red candles since the week’s opening. The next downside target on the daily scale can be seen at 0.7532: 21/11/17 low, followed closely by daily support fixed at 0.7505.
Looking across to the H4 timeframe, H4 price came within a few pips of retesting the underside of the 0.76 handle on Wednesday, before aggressively pressing lower. The move, as you can see, managed to marginally whipsaw through local H4 support at 0.7555 (see black arrow). As far as we’re concerned, this was sufficient enough to wipe out buyers and trap breakout sellers to clear the path south down to the H4 Quasimodo support planted at 0.7536.
Suggestions: Although the H4 Quasimodo support at 0.7536 may bounce price, it is not a level we’d trade. This is largely due to the 0.75 handle (not seen on the chart) boasting so much confluence and, therefore, likely to be the better buy zone. Just to recap, 0.75 boasts not only the aforementioned weekly structures; it also merges with a daily support mentioned above at 0.7505.
On account of the above, we will, dependent on the time of day (news), be looking to buy 0.75, with stops positioned 50-70 pips below. This should provide the trade enough breathing room, as this could potentially be a long-term trade with great risk/reward.
Data points to consider: AUD private capital expenditure q/q and building approvals m/m at 12.30am; Chinese manufacturing PMI at 1am; US unemployment claims at 1.30pm; US core PCE index m/m; US Chicago PMI at 2.45pm; FOMC member Quarles speaks at 5.30pm; FOMC member Kaplan speaks at 6pm GMT.
כתב ויתור
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