Commodity currencies seem to be in the mood for corrections from their recent rallies, so I’m looking at these potential pullback setups and inflection points.
| AUD/USD | USD/CAD | NZD/USD | |
|---|---|---|---|
| Week Open (WO) | 0.7918 | 1.2656 | 0.7402 |
| Previous Week High (PWH) | 0.8043 | 1.2669 | 0.7525 |
| Previous Week Low (PWL) | 0.7891 | 1.2433 | 0.7388 |
| Top Weekly ATR (tWATR) | 0.7987 | 1.2749 | 0.7464 |
| Bottom Weekly ATR (bWATR) | 0.7850 | 1.2562 | 0.7340 |
| Other significant levels | 0.7800, 0.7900 | 1.2500, 1.2600 | 0.7300, 0.7400 |
In case you’re wondering what ATRs are all about and how I computed those figures, make sure you check out my entry explaining my trading strategies.
Here are some of the comdoll forex setups I’m looking at this week:
AUD/USD: 1-hour
It looks like consolidation is the name of the game for AUD/USD as price has formed lower highs and found support around .7900, creating a descending triangle on its 1-hour time frame.
Stochastic is pointing up to signal that buyers could regain the upper hand and push price back up to the resistance around the .7950 minor psychological level. Stronger bullish pressure could take it past the triangle resistance and onto an uptrend, but this might depend on how risk sentiment fares this week.
USD/CAD: Daily
This one’s still in correction mode as it looks prime for a huge pullback to the Fib levels marked on its daily time frame. The 38.2% Fibonacci retracement level is close to the 1.2950 minor psychological level while the 50% Fib lines up with the 1.3100 mark.
Stochastic is still heading north so USD/CAD could follow suit. A larger correction could hit a ceiling at the broken long-term rising trend line just slightly above the 61.8% Fib.A move past the 1.3300 area, however, could signal that buyers aren’t backing down anytime soon. The OPEC meeting early this week could make or break the oil rally, which could also set the tone for the positively-correlated Loonie.
NZD/USD: 4-hour
The Kiwi continues to trend higher against the dollar, even as the latter got a boost from upbeat NFP results. Price is moving closer to testing the ascending trend line support visible on the 4-hour chart.
Applying the Fib retracement tool on the latest swing low and high shows that the 50% level is closest to the rising support level while the 61.8% Fib coincides with a former resistance zone. If any of these areas keep losses in check, NZD/USD could make a move back to its swing high and beyond.
Cheers,
See also: Q2 2017 Trading Performance Review
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