It’s all about trends and corrections this week, so I’m planning on going with the flow on these setups on AUD/USD, USD/CAD, and NZD/USD. Take a look!
|Week Open (WO)||0.7649||1.2760||0.6911|
|Previous Week High (PWH)||0.7730||1.2915||0.6951|
|Previous Week Low (PWL)||0.7639||1.2715||0.6839|
|Top Weekly ATR (tWATR)||0.7714||1.2856||0.6984|
|Bottom Weekly ATR (bWATR)||0.7584||1.2665||0.6839|
|Other significant levels||0.7800, 0.7600||1.2740, 1.2630||0.7060, 0.6820|
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:
A downtrend is brewing for AUD/USD as the pair is starting to form a descending channel on its 4-hour time frame. Price is currently testing support, though, while stochastic is dipping into oversold territory.
A return in bullish pressure could lead to a bounce back to the channel resistance, which lines up with a former support area around the .7800 handle. Aussie bears might be waiting to short at this level, which might keep gains in check and allow the selloff to resume.
Dollar strength has also been in play for this pair, which has been moving above an ascending trend line connecting the lows since last month. Price looks ready for a correction to this support zone, which lines up with the 61.8% Fib but the nearest retracement level already seems to be holding as a floor.
At the same time, stochastic is starting to pull up from the oversold region to indicate that buyers are regaining the upper hand. In that case, price could make its way back up to the swing high from here.
Aha! I’m finally seeing a pullback opportunity after the Kiwi’s sharp dive the other week. Recall that this pair breached the long-term rising trend line on its daily chart to signal that a downtrend is in order.Zooming in to the 4-hour chart shows that price is trading below a descending trend line and could be due for a correction to the area of interest near the 61.8% Fib. However, stochastic is already heading south so price might follow suit as sellers are eager to hop back in.
In that case, another test or break of the swing low could be underway, triggering yet another steep drop for NZD/USD.
See also: Q3 2017 Trading Performance Review
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