AUDUSD Nears Trendline, USDCAD Support Closer to 9900

2012-05-11 13:43:00 Jamie Saettele, CMT, Sr. Technical Strategist

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IN GENERAL – Work down from larger degrees of trend. Markets (crude, copper, equities especially small caps, and commodity FX) are on the way down after forming multiyear topping patterns. Many of these topping patterns take the form of head and shoulders tops. Strength should be sold. From a timing perspective, pay attention to the opening range for respective markets (early Asian session for AUDUSD and NZDUSD). Map out your levels and know what you will do when that price is reached. Beware of rumors and event risk, which often result in countertrend spikes (best to fade these spikes). If you want to learn more about specific timing strategies (opening range for example) and my trading, then join my next week for a trading bootcamp.

I maintain that the best way to play the global slowdown is through the AUDUSD. I’m looking lower today towards 9975 and 9860 as long as price is below last night’s high (10090). Exceeding that level puts 10145, 10165, and even 10225 back in play as resistance early next week. The AUDCAD is the biggest loser today on the back of CAD jobs but underlying macro trends are likely to win out and support USDCAD over time. On that note, USDCAD support is expected from 9900-9930. AUDJPY is a candidate of course but I’d rather not deal with the intervention headache that comes with owning JPY.

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