News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Wall Street
Bearish
Low
High
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
  • Trading bias allows traders to make informative decisions when dealing in the market. This relates to both novice and experienced traders alike. Start learning how you may be able to make more informed decisions here: https://t.co/rz7fqhRoMG https://t.co/lccPTTlvj0
  • GBP/USD’s consolidation could end soon if price breaks out of a symmetrical triangle in play since July. At this time, a downside breakout is likely following the appearance of a death cross. Get your weekly $GBP forecast from @DColmanFX here: https://t.co/WIKdSesfkJ https://t.co/Fx0qr32xgI
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/IRS9MaA7h8
  • The Federal Reserve rate decision is likely to sway the near-term outlook for the price of gold as the central bank appears to be on track to scale back monetary support. Get your weekly gold forecast from @DavidJSong here: https://www.dailyfx.com/forex/fundamental/forecast/weekly/CHF/2021/09/18/Gold-Price-Outlook-Hinges-on-Fed-Rate-Decision-Forward-Guidance.html https://t.co/dWWxtErjK0
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/4qxwiJsV1K
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/stMPuq0VXR
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/v6RGICQvge
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/rws9LHJV3E
  • RT @FxWestwater: Japanese Yen Forecast: JPY Crosses Eye BoJ, CPI as Haven Flows Bolster Yen Strength Link: https://www.dailyfx.com/forex/fundamental/forecast/weekly/jpy/2021/09/18/Japanese-Yen-Forecast-JPY-Crosses-Eye-BoJ-CPI-as-Haven-Flows-Bolster-Yen-Strength.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https:/…
  • Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Learn more about time-frame analysis here: https://t.co/9S5tXIs3SX https://t.co/FVisZuTP6M
A "Steamroller" AUD/CAD Trend That May Soon Reverse

A "Steamroller" AUD/CAD Trend That May Soon Reverse

Kaye Lee, Head Forex Trading Instructor

Talking Points:

  • "Steamroller" Momentum in AUD/CAD
  • Textbook Pullback to Daily Support
  • The Key Support Zone for Buying AUD/CAD

Few traders would be willing to stand in front of a trend that has exhibited a lot of momentum, and that’s precisely what can be seen on the below hourly chart of AUDCAD.

The last couple days have been extremely volatile for the Australian dollar (AUD) against all currency counterparts, and as such, many AUD charts look like the one below. As a result, most short-term traders will likely already be short or looking for an AUD short right now. However, for traders who wish to enter on the hourly time frame, it is worth considering how much room is actually left for this downward move to run.

Guest Commentary: News-Inspired Momentum Move in AUD/CAD

The hourly chart of AUD/CAD shows two swift, sharp, and news-induced bearish momentum moves in recent days.

As shown, there have already been two clear legs to the down side in AUDCAD, and in spite of the steamroller-type momentum, there are bigger-picture factors that suggest that there may be at least a pause or bullish reaction in the near future.

The daily chart below shows this proposition very clearly, with prices pulling back to an extremely obvious rising support line. Given that this upward move has been in progress since January 2014, it seems reasonable to assume that residual bulls watching this time frame will give the upside one more try. As there are more than 130 pips of potential upward movement from the nearby trend line, and because this is such a textbook pattern, it seems worthy of a trade or two on the lower time frames.

Guest Commentary: Textbook AUD/CAD Pullback to Support

A clear pullback to rising trend line support on the daily chart of AUD/CAD helps validate the case for new long positions on shorter-term time frames.

The four-hour chart below tells the story even more definitively, showing an obvious zone of confluence support. From this four-hour perspective, the most telling feature about this pullback is the lengthening candle wicks as price approaches the support zone. Nonetheless, in order to respect the extreme bearish momentum seen recently, the zone selected is 1.0165-1.0197, which is a little further away than it might otherwise be.

Guest Commentary: Key Support Zone for Buying AUD/CAD

Confluence support on the 4-hour chart of AUD/CAD helps define the zone where risk-controlled long positions can be initiated in the pair.

In spite of everything, this support zone is only a mere 32 pips deep, which satisfies even more stringent risk considerations. Nonetheless, an entry on the hourly time frame would be preferable for this trade, using pin bars, bullish engulfing patterns, and/or bullish reversal divergence as viable entry signals. All that remains at this point would be to wait for price to touch the highlighted support zone.

Of course, two or three attempts may be required in order to effectively enter and stay in this trade. By selecting a support zone that is slightly further away from the current price, the hope is that any last-minute choppiness will be accounted for. However, a notable disadvantage is that if price suddenly turns around before touching the blue box, traders could potentially miss out on this move.

By Kaye Lee, private fund trader and head trader consultant, StraightTalkTrading.com

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

DISCLOSURES