AUD,NZD/Technical Analysis

AUD/USD: If it breaks cleanly above 1.0550 then I’m giving up

I’ve been running a short strategy in AUD/USD for some time now but I must say I’m starting to get more than a little worried about the overall direction of this trade. Despite all the reportedly heavy sell orders near 1.0500, the very poor economic data of recent times, and a rate cut today, we are still trading at 1.0440 and having trouble dipping. What happens if the news turns good and the market gets really bullish? Will we be trading at 1.15 in January?

I will not be hanging around to find out and if this pair trades cleanly above its weekly bearish trendline (currently near 1.0530 according to my best line-drawing efforts) then I for one will be bailing out

  1. It’s not a good thing for Australia that the currency is so strong and there are myriad reasons why it should fall. In fact, it is a sign of just how poor the global financial options are that the South Pacific Peso is seen as a haven – but it is. Seems set to benefit on both a deterioration and improvement in global financial conditions. Some how it has managed to embed itself with a free put and a free call!

  2. Good evening Sean,

    After a rate cut, the price action in AUD/USD is unusual. You should be cautious with this trade, of course you know it. It’s not an old monkey that one teaches to make faces 🙂

  3. I welcome, Sean!
    AUD/USD I think it is necessary to start selling not earlier 1.0594 and gradually to build short positions to 1.0655, to put stops for 1.07, the purpose of sales 1.0051, 0.99 and further below, but it will be thus possible to take away a part of profit and to buy AUD for a rebound up, then to add sales still, there it will be necessary to look where to sell. It is a medium-term view of AUD. Successes to you Sean!

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