AUDCAD Threatens Weekly Opening Range- Long Scalps Favored Above 9750
- AUDCAD reversal in focus
- Weekly OR break keeps topside bias in play
- Key Event Risk on Tap
Chart Created Using FXCM Marketscope 2.0
- AUDCAD breaks above weekly opening range high- bullish near-term
- Resistance at 9835 / January TL & 9927/36
- Support at 9700 & 9630/57- bullish invalidation
- Daily RSI signature remains constructive / 50-bounce today
- Event Risk Ahead: Australia Employment data & Canada New House Price Index on Thursday
Notes:On January 27th we noted a short-bias on AUDCAD while below 9928 with the ensuing sell-off taking the pair into the 9630/57 key support zone. The rebound closed last week just below near-term resistance at 9777/85- where this week’s opening range high was targeted. A slope line extending off the February high also converges on this region today with momentum signature holding 40-support since the start of the week- constructive.
The breach above this region this afternoon was accompanied by a trigger break in momentum, confirming our near-term topside bias eyeing targets at 9835 & the 100% extension at 9864. Note that this level converges with basic trendline resistance off the January high into the close of Asia trade tonight. Bottom line- we’ll favor buying pullbacks while above 9750 (gap) with a breach above 9864 opening up targets into 9895 & 9928. A break below the weekly opening range low invalidates the setup with such a scenario targeting key support at 9557/66. A quarter of the daily ATR yields profit targets of 31-34 pips per scalp. Caution is warranted heading into event risk out of Australia with the employment report on Thursday likely to fuel added volatility in Aussie crosses.
* 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
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---Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
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