For intermediate-term fundamental and technical outlook for major markets/currencies, check out the recently released DailyFX 2Q Forecasts.
Barring a strong reversal between now and the close of today’s session (~5 hours from now), AUD/USD will post its second bearish reversal in the past five sessions. The reversal comes from an upper parallel, a failure to overcome a late-March swing-high, and the 200-day MA.
Placing a stop above today’s high by 20 pips (7832) should keep it out of harm’s way should the trade work out. A push above today’s high would bring into play a larger rebound. Looking lower, the January 2016 trend-line is the targeted objective. Given the distance from entry to stop and from entry to target, the risk/reward on this set-up is a sufficient ~1:2.
Shorter-term minded traders looking at intra-day time-frames can use the path of least resistance as a guide for making tactical maneuvers for as long as the broader trade outlook remains intact.
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AUD/USD Daily Chart (Bearish Reversal)
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---Written by Paul Robinson, Market Analyst
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