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AUD/USD Exhaustion Trade- Shorts at Risk Above 8064

AUD/USD Exhaustion Trade- Shorts at Risk Above 8064

2014-12-18 20:03:00
Michael Boutros, Technical Strategist
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Talking Points

AUD/USD Weekly

AUD/USD Exhaustion Trade- Shorts at Risk Above 8064

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • AUDUSD coming into key support threshold / inflection range 8065-8118
  • Region defined by the 1.618% ext off the 2011 high & the 2010 low
  • Shorts at risk into this region- bullish invalidation

AUD/USD Daily

AUD/USD Exhaustion Trade- Shorts at Risk Above 8064
  • Note that a median line off the 2013 October high also converges on the 8067-8118 region
  • Aussie trading within an operative descending pitchfork off the 2014 October high
  • Interim resistance 8195- converges on upper MLP early next week
  • Breach targets 8411/24, 8540
  • Support break targets 80-handle & 7645 (61.8% retracement of 2008 rally)

AUD/USD 30min

AUD/USD Exhaustion Trade- Shorts at Risk Above 8064

Notes:The aussie sell-off has come into a key region of support with the range extending from 8067 into 8120. Shorts are at risk here and we’ll look for reversal signals heading into next week. The pair has been holding within the confines of a descending Andrew’s Pitchfork formation off the November highs with a breach above the upper median-line parallel is needed to confirm a near-term rebound.

Bottom line: Looking for an exhaustion low in this region over the next week with a breach above this formation shifting our near-term bias higher in the aussie. Ultimately we would be looking to sell this rally with the medium-term outlook remaining weighted to the short-side.

* 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.

Relevant Data Releases

AUD/USD Exhaustion Trade- Shorts at Risk Above 8064

Other Setups in Play:

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

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

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

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