Trade Canceled: AUD/USD Channel Retracement

Things aren’t looking so good for the Land Down Under and its trade buddies lately so I’m canceling my open orders on this AUD/USD long setup.

AUD/USD Trade Idea

Earlier today, Australia reported a 3.7% slump in quarterly construction work done, worse than the projected 1.9% decline. This follows reports of a slowdown in China’s property sector, also dampening demand for steel, iron ore, and raw materials from Australia, on top of weaker trade activity in New Zealand.

On the other side of the coin, the U.S. dollar still seems to be staying supported by expectations of hawkish remarks from Fed head Yellen in the upcoming Jackson Hole Symposium. As Forex Gump discussed in his article on what to expect for this event, FOMC members have been giving mixed signals and Yellen might settle the score during her speech on Friday.

AUD/USD 4-hour Forex Chart

AUD/USD 4-hour Forex Chart

Because of this looming event risk and the not-so-upbeat outlook for Australia, I’ve decided to cancel my pending orders to buy AUD/USD at .7575. The ascending channel still looks intact and the Fibs appear to be holding as support for now, but I’m inclined to wait for more technical and fundamental confirmation before reestablishing my bias.

Got any new comdoll trade ideas you think I should be considering? Maybe something among the crosses?

Cheers,

Happy time

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  • Thanks for sharing your thoughts, Jonathan! Keeping close tabs on AUDNZD then. How’s your trading going?