We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
Oil - US Crude
Wall Street
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • US equities continue to run higher with the Nasdaq 100 setting a fresh all-time-high, not even three months after giving back almost a third of its value in about a month. Get your #Nasdaq technical analysis from @JStanleyFX here: https://t.co/1LI54uvI8x https://t.co/e9FvSLqfaA
  • The US Dollar may be at risk to losses against some of its #ASEAN counterparts. USD/SGD, USD/PHP, USD/MYR and USD/IDR have recently broken to the downside. Will losses continue? Find out from @ddubrovskyFX here: https://t.co/0RTlj6maTT https://t.co/UyQ4i0AihI
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/AJlT2YKeCu
  • USD/JPY is approaching medium-term uptrend resistance and while the outlook remains constructive, the advance may be vulnerable near-term while below confluence resistance. Get your $USDJPY technical analysis from @MBForex here: https://t.co/93D7AyhHtG https://t.co/KQcLLrkMP3
  • AUD/USD has had the most impressive show of trend over the past couple of months with the pair gaining almost 1500 pips from the March low. Get your $AUDUSD technical analysis from @JStanleyFX here: https://t.co/vLz4Rpln3u https://t.co/AOwnJja5V8
  • Has the #Euro been saved? Find out from @CVecchioFX here: https://t.co/eiXfOTyGa6 https://t.co/AyRiYpb4cN
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/ygwjGNvS61
  • The $USD, Euro, British Pound and Australian Dollar will all be at the mercy of political developments in Asia, Europe and North America this week. An avalanche of PMI data will set the backdrop. Find out from @ZabelinDimitri here: https://t.co/L8cfAgVx94 https://t.co/THWhPAS6AM
  • The price of #gold plunged 1% immediately after the stunning US jobs report crossed the wires. Get your market update from @RichDvorakFX here: https://t.co/8i0L6YIqjy https://t.co/y9dIXazJf9
  • S&P 500, Dow Jones, Nasdaq explode higher with stocks surging in response to shockingly better-than-expected monthly jobs data. Get your #equities market update from @RichDvorakFX here: https://t.co/nuMVWOzzuC https://t.co/M3nGBjd7kZ
Using Fibonacci to Find AUDUSD Trade

Using Fibonacci to Find AUDUSD Trade

2013-12-17 20:08:00
Gregory McLeod, Currency Analyst

Talking Points

- AUDUSD has been on a downtrend and may continue to push lower.

- Previous levels of Fibonacci support can act as resistance levels

- When one Fibonacci level is broken, price often moves down to the next level of Fibonacci support.

One way traders like shorting after price breaks below a trendline or other significant level of support is to use breakout technique. This involves getting short immediately after price moves through a level of support. However, price oftentimes, retraces to retest the breakout area and traders have to endure time wasted and negative drawdown that comes along with this retrace.

One solution to this issue is to wait until a retrace happens following the initial move. This requires patience on the Forex trader’s part as the thought of missing a big move may outweigh the cool logic of waiting for a better price to short at a higher level. Remember, while bulls look to “buy low and sell high,” bears look to “sell high and buy low.” Therefore, selling at the highest price possible before a drop is the goal. Fibonacci can help us “pick tops” in a downtrend

Learn Forex: AUDUSD Close Below Fibonacci Support

Using_Fibs_to_Find_AUDUSD_Trade_body_573.png, Using Fibonacci to Find AUDUSD Trade

(Created using FXCM’s Marketscope 2.0 charts)

In the chart above, using the AUDUSD 10/27/2008 swing low at 0.6005 and connecting it to the 7/27/2011 swing high of 1.1079 Fibonacci lines were drawn. These lines were tested numerous times while the pair traded in a range. After a level was broken, price moved down to the next level of Fibonacci support. Notice how AUDUSD rebounded from the 23.6% Fibo several times from August 2011 to June 2012.

Next, we saw AUDUSD push down to the 38.2% level at 0.9138 on June 20th. Aussie finally rebounded from this Fibo on 9/5 falling 130 pips short of the 23.6% Fibo at 0.9878; Aussie has been trending down ever since. The 23.6% Fibo of this first set is located at 0.9108 and it could be a possible area to get short. These levels can be used to set profit targets as well as anticipation on entry points.

Using_Fibs_to_Find_AUDUSD_Trade_body_574.png, Using Fibonacci to Find AUDUSD Trade

(Created using FXCM’s Marketscope 2.0 charts)

The Trade Setup

The current rebound from the 0.8900 round number support can be used as the ending point of a set of Fibonacci resistance lines starting at 0.9762 (blue lines). The confluence of the trend with the uptrend and downtrend Fibo levels provide a good shorting opportunity. The resumption of the downtrend could see the Aussie moving down almost 600 pips to the 50% Fibonacci level at 0.8540.

The Aussie has not traded at this level since July 2010. Currency pairs have a tendency to overshoot, so waiting for Aussie to turn down from the 23.6% downtrend Fibo level (0.9108) and the 38.2% uptrend Fibo level (0.9138). A stop can be placed above the last swing high once the down trend resumes with a limit of 0.8540.

---Written by Gregory McLeod Trading Instructor

To contact Gregory McLeod, email gmcleod@dailyfx.com.

To be added to Greg’s e-mail distribution list, please click here.

Follow me on Twitter @gregmcleodtradr.

This article showed you how to use Fibonacci to trade AUDUSD, I want to invite you to enroll in our free Fibonacci Retracement Courseto further your understanding of Fibonacci. Sign our Guestbook to gain access to this course that will help you get up to speed on Forex market basics. You can master the material all while earning your completion certificate. Register HERE to start your Forex learning now!

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.


News & Analysis at your fingertips.