About Pick of the Day

Each day, I will try to find what I believe is the best looking short term trade setup for the upcoming trading day or week. If you're a forex newbie, it can be tricky in the beginning trying to figure out how to look at charts and draw lines. My goal is help you understand the psychology of price movements so you can learn to analyze your own charts and trade on your very own. I will post my ideas and/or reviews through out each session right here, on Twitter and on Facebook.

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May 2006

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Pick of the Day: AUD/USD

Posted 20:35 09 May 2006 | Comments

I'm looking at the Aussie dollar again for a few reasons. Mainly, commodities did a turn around after a few days of weakness, and with economists urging the Chinese government to increase gold reserves, we may see the recent highs of gold to continue. So, with gold and the Aussie dollar moving almost in sync in recent trading sessions, we should see the uptrend in this pair to carry on.

Also, we have the US Treasury report being released and the FOMC interest rate decision. Traders will be on the lookout for hints on future FOMC interest rate moves(if and when the will stop interest rate hikes), and if the US Treasury will label China as currency manipulators. These decisions can have a very profound affect on the US dollar. I'm looking for this pair to continue its trend higher, and here are a couple of ideas to catch the trend.

Long AUD/USD at .7764, stop at .7712, PT1 at .7777, PT2 at .7796

If the pair moves lower, then:

Long AUD/USD at .7704, stop at .7660, PT1 at .7722, PT2 at .7749

Good luck and good trading!