The Reserve Bank of Australia is set to rock the Aussie soon, making these crosses setups the top watch priority for the week!
On the four hour chart of AUD/CAD above, we’ve got the classic Fibonacci retracement short setup in the works. After a momentum move from 0.9600 to bottoming out around 0.9200, the pair has bounced up to retest the strong area of interest around 0.9400 that held as support before being broken in May.
This area also lines up with the 38% to 50% Fibonacci retracement area, which could be attractive to sellers as the moment as the stochastic is signaling short-term overbought conditions. A perfect short Aussie setup if this week’s fundamental updates line up with the bearish price action bias.
For the potential Aussie bulls out there, this setup on the daily chart of GBP/AUD is one to watch as it is pair up with the relatively weak British pound due to Brexit drama.
The pair recent bounced lower from a strong resistance area between 1.8800 – 1.8900, and it is now testing the next strong area of interest around 1.8100 that held as support back in April. If the Aussie sees positive fundie developments and a bullish reaction, a break of this area could draw in momentum sellers that could bring this pair well on it’s way to the next major low around 1.7300 within the next few weeks–almost 800 pips away!
AUD/CHF on the four hour time frame is the chart you wanna check out if you’re kinda on the fence with your directional bias. Obviously, the pair is in a downtrend and after a little bit of consolidation between 0.6900 – 0.7000. That makes a retest and reversal of 0.7000 one to watch for more conservative traders for a short play, or a break of the 0.6900 an entry setup for the more aggressive types.
For the bulls, a break above the falling ‘highs’ pattern and the strong area of interest between 0.7000 – 0.7050 the signal to watch out for long position, given that the RBA surprises the traders with less expectations of a rate cut down the road.