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AUDUSD Losses Likely Limited in the Interim- Scalps Turn Long

AUDUSD Losses Likely Limited in the Interim- Scalps Turn Long

2013-05-14 20:00:00
Michael Boutros, Strategist
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AUDUSD Daily Chart

Forex_AUDUSD_Losses_Likely_Limited_in_the_Interim-_Scalps_Turn_Long_body_Picture_2.png, AUDUSD Losses Likely Limited in the Interim- Scalps Turn Long

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • All three objectives noted in last week’s AUDUSD scalp report have now been achieved
  • 7-days of consecutive declines for first time since December 05’- (Note: That year saw 8 days down followed by massive reversal which pared nearly the entire decline)
  • Daily RSI now sitting (matches) lowest level since May 2012 (right before the rally to 1.06)
  • Broader bias remains bearish- Risk of near-term correction has us looking higher over next day or so
  • Daily resistance at 9980, 1.0025 bearish invalidation point
  • Break below 9880 threshold looks for 2011 trendline support (currently around 9860)
  • Medium-term objectives at 9805 (Key Fib confluence) and 9700 (88.6% Fib retracement)

AUDUSD Scalp Chart

Forex_AUDUSD_Losses_Likely_Limited_in_the_Interim-_Scalps_Turn_Long_body_Picture_1.png, AUDUSD Losses Likely Limited in the Interim- Scalps Turn Long

Scalp Notes: Bottom Line: Although our longer-term bias remains weighted to the downside, the conditions here are set for a possible relief rally which may offer more favorable short entries higher. Our immediate bias therefore shifts cautiously to the long-side above 9880. Note that a break below this level may be required to see a test of the multiyear-long trendline support dating back to the 2011 lows with a rejection here and a move back above 9880 offering further conviction on a near-term bounce. Broader bias remains bearish so long as the 1.0025 resistance threshold is respected.

*We will remain flexible with our bias with a break below the 9960-80 range eyeing subsequent support targets. It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases. Use this app to distinguish the various trade sessions.

Key Threshold Grid

Entry/Exit Targets

Timeframe

Level

Significance

Resistance Target 1

30min

9912

1.50% Fibonacci Extension

Resistance Target 2

30min

9938

1.382% Fibonacci Extension

Resistance Target 3

Daily

9980

61.8% Retracement

Bearish Invalidation

30min / Daily

1.0025

100% Extensions

Break Target 1

30min

1.0050

Soft Resistance / Pivot

Break Target 2

30min

1.0075

78.6% Fibonacci Extension

Break Target 3

30min

1.0114

61.8% Fibonacci Extension

Break Target 4

30min

1.0140

50% Fibonacci Extension

Break Target 5

Daily

1.0163

61.8% Fibonacci Extension

Bullish Invalidation

30min / Daily

9885

1.618% & 138.2% Fib Exts

Break Target 1

30min / Daily

9857

1.732 % Ext / TL Support

Break Target 2

Daily

9805

78.6% Retrace / 1.618% Ext

Break Target 3

Daily

9701

88.6% Retracement

Average True Range

Daily

96

Profit Targets 22-24pips

Other Scalp Setups in Play- GBPUSD Clears Primary Objective- Short Scalps In Play Sub-1.54

Reviews today’s Scalp Webinar for further insights and current trade setups

For updates on this scalp and more setups follow him on Twitter @MBForex

---Written by Michael Boutros, Currency Strategist with DailyFX

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael Tuesday, Wednesday and Thursday mornings for a Live Scalping Webinar on DailyFX Plus (Exclusive of Live Clients) at 1230 GMT (8:30ET)

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