AUD/USD

boy is this baby going down

Wizhoo

What indicators do You use? Can you post them(expect sStochastic)

Now may be a good time to start building a long position, with small lots.

I'm long this pair as of about 20 minutes ago. I hope to catch some pips off of a bounce off the slightly rising trendline on the 4 hour and daily charts. We'll see what happens.

Jon

http://tradinggroove.com/image.axd?p...0202_Daily.jpg

I see a strong move up blowing away R2 around 0.6440 today; Dow futures looking positive, and the rate cut is in line with expectations. Will ride this through the NY session.

My crystal ball says that Australia is going to be in ruins very soon.... but then I am not basing that on anything except my crystal ball.

I'd like to make a case for OZ in the short term, not withstanding the big picture,
which still could have more room on the downside in the months ahead if the 60 cents level
was successfully breached and the RBA ran out of bullets. Could happen.

In the meanwhile, a few things stacked in favor of near term support are as follows:

I) A successful test of the Daily trendline support held on Monday Feb 2nd, 2009.
The 6250~ level brought buyers out of the woodwork. (Figure 1)

II) This bounce coincided with the 85.4% retracement of the distance from the
low set on 20th November, 2008 @ 6074 to the high set on 7th January 2009 @ 7269.
Nearly 1200 pips. I'll call it 1200 just for simplicity's sake. (Figure 2)

III) In an AB = CD measurement, the movement from 12/18/08 to 1/15/09,
not withstanding the higher highs reached in the 1st week of January,
measured about 600 pips.

Not to be considered "retrofitting" the measurement, the use of the penultimate high
on 12/18/08 instead of the highest printed price on Jan 7th points to a irregular sharp of sorts
in an ABC corrective pattern where the B wave exceeds the A by nearly 38%, then, from the top
the pattern completes itself in 5 waves down in C. There, is that EW enough for you ? Me too.

Then, the movement from 1/19/09 to yesterday's low (02/02/09) also measured about 600 pips.
All this hitting at the 85.4 Retracement level. (Figure3)

This pics below spell this out with a bit more graphic detail.

I threw this together in a few minutes, as I have company coming over,
but I wanted to share what I think could be the case being made for a short term reprive
for the Australian Dollar vs. the US, even if the outlook later is more bleak.

Revisiting the 70 cent level wouldn't come as a great surprise.

Too much over 70 to 75 cents WOULD begin to surprise people

A return to 80 cents could drive the market bats, myself included.
I don't expect a recovery of this magnitude, even though that's 50%
of the move down, it just might be too much to ask of the OZ.

Only a few percent needed to shake out the heavy short interest built up over the last QTR or so.

The price of Gold could have a hand in this either way it turns out.

Thanks for your comments.

That's some great analysis! I just thought that RBA's move and stimulus package have been perceived (at least initially) as positive developments for the currency. I also think that in a very short term (think 1-2 days), equity markets worldwide may be due for a small bounce, a DCB perhaps but nonetheless there's a good chance here. We are also looking at BOJ going into the spending mode to buy corporate stock, which may depreciate the yen a little as well.

Obviously, none of this is relevant if the Dow tanks 500 points tomorrow.

Thank you.

And you are right, one big plunge and this and many other well thought-out analysis go out the window.

Would however like to see A/U remain above the 6300 figure for the rest of the week
and get some stronger closes to confirm the selling has abated for now.

Until more signs show strength, especially on the back of (another) rate cut,
must tread with caution. After all, it's only 2% off this newly formed "bottom"
and could get smashed like a glass vase in one session. Gotta wait n' see.

Thanks again for responding.

This is trending up very nicely. This is an updated chart from my post #1047

I got in at the break of the wedge going north and will add to my position at the fib 38.2 if the bull continue thier charge.

Yes, we've seen a nice move up so far. I got in at 0.6366, and I hope we make it to the fib 38.2. We've got to break through the falling trendline on the daily chart before making to that level, though, but if we do, I can see it going much higher.

Good trading to you,

Jon

I got out for awhile as it was getting weaker here but with volumes dropping and the appearence of the doji the bulls may be ready to take control again.
I'll be looking to jump in if it breaks this mini trendline.

Okay, can someone clue me in - what the hell just happened to cause this 150 pip drop in the space of 1.5 hours?

Too much expectation on the AUD to go back to 70+ when the AUS GOV is doing everything to keep it above 62. The hedge funds are driving it lower so for me I am taking time before trading again. Friday I expect it to be .6250. Good luck as if anyone works it out they will do well.

Yeah, there's a ridiculous amount of fear on the market. A good rally is needed to bring things back to normal a little.

The Opposition Leader came out and said that they would not vote for the 42 Billion package, that's what happened!

GP

Great call mate! How do you see AUD/USD going this week?

Mother of all bear flags on AUD/USD!

http://i43.tinypic.com/wat7qq.jpg

Welcome to Forex Factory !!!
(Noticed you're 1st time to post)

Got a bit a mileage out of that move, but as far as the next few days,
as I said before, just looked like OZ was due for a bit of a reprive and we got it.

The resistance above 68 (vs. USD) is considerable, so a pull back should be a few hours away.
Maybe today, maybe tomorrow, but I don't fight trends, so I'm waiting.

With a big outside bullish bar on the weekly, no doubt bids will begin to form
between 65 to 66. Lots of volume traded at those levels so return to test won't surprise.

If the market slows down long enough to build some type of support,
another stab at the 70 handle shouldn't surprise either.
(must break 68 decisively, daily close preferred)

Bits and pieces of news between now and Friday, when the G7 gets underway,
Nothing has negated the Big-Picture downtrend as of yet, so I'm not buying anything up here.

I can not sell too heavy either yet because I'm expecting atleast one more leg up.
Maybe just a scalp or too, back to 66. Nothing big at all.


My advise is: just don't get in a hurry, The year's just begun !

What do you use to gauge the volume at any particular level?