AUD/USD

This is a great setup on the AUD:

-White highlight is a nice retrace candle for an already CONFIRMED up move.


-If you are able to get price anywhere in the entry zone I have drawn that is ideal.


-Dotted red is great R:R stop and solid red is where price will not cross before it hits TP


-TP is brown dotted line//yellow highlight!




Good Luck!

Wait till next market open to take this...no need to sit on it over the weekend

-UPDATE - TOOK IT HOME...-20 pips, stay away 1.02, hello .99

Idea:

So automated strategies doing great aside.

In Manual trading, I for some reason had two hedges open this morning and in a rush, closed out the loss and kept the profit on, which turned into a negative -30 pips upon the retrace (targeting ~150 pips down) at .995 Aussie. Oops, not my brightest execution today, I turned a winner into an underwater trade, bad!

However now, I find myself 25 minutes from having to eat that stupid rollover and also risk that it goes up to 1.0225, stops me out and seeks profit on monday.

However, it's definitely held the 1.02 level solidily this whole week, why wasn't it taken out and what would be the catalyst to blast through 1.02 next week?? Versus why won't it fall?

(I'm wondering if I should just take this trade home, since it's still in my plan and resistance is solid, or bail out now and avoid the rollover fees).



www.opensourcewallstreet.com -building a automated strategy forum for advanced strategies (not just fx and mt4)

AU is unlikely to break out above 1.02 until UJ breaks below the trend line support (see chart) aka carry trade and the measure of risk appetite. Nice bear candle on UJ today.

The inter-relationships between different pairs and the co-dependence factors matter. Other than UJ, AU is also strongly influenced by the EUR/AUD cross - this will need to see some significant bear traffic in order for AU to clear the 1.02 hurdle.

Next week should bring the major up move on AU, however it may well continue to consolidate further within the ascending wedge first.

Financial market stress is at its highest levels since before the Board of Governors announced they would halt stimulus withdrawal and would in fact add to it with a $600 billion Treasury buying program. We have yet to see panic spread across the speculative population; but there are credible developments that should put every trader on alert. In addition to record food prices, China’s efforts to curb growth, growing strains between austerity and growth efforts and unrest in the middle east driving energy prices to painful levels; capital imbalances may start shifting funds from high-yield emerging markets to the rising return in certain advanced economies. While this is a pursuit of return, it is also an assessment of risk - giving up a little yield for a sense of stability.

One currency that we feel could be very exposed over the medium and longer-term is the Australian Dollar. We currently hold a short AUD/USD position from 1.0170, and will look for an acceleration of declines over the coming days and weeks. Data out of Australia has been moving in the wrong direction, while the central bank has moved to a much less hawkish stance. Meanwhile China has been showing signs of cooling down, while Australia’s own PM has been out expressing serious concern over the impact of the strength of their currency on the local economy.

An article in the Economist reaffirms our net bearish Aussie sentiment, with the publication warning of a major housing bubble in Australia. The magazine’s quarterly index of house prices has Australian homes as the most overvalued across the globe. While in the United States, the ratio of house prices to rents is only 3% overvalued, in Australia, this same ratio shows Australian house prices to rents a dramatic 56% above their long run average.
We wonder if the Australian Dollar could also be exposed over the coming days. Technical studies are certainly well overbought on the daily chart.

A stronger Aussie over the past few months appears to be harming exporters, with the trade deficit widening in the fourth quarter. Although the Reserve Bank of Australia held rates at 4.75 percent, it is clear that underlying price pressures are building. With their antipodean neighbor to the south expected to lower rates this week, investors will be closely examining the Australian economy to see if similar conditions arise in Australia that could elicit similar concerns.

Wednesday’s Home Loans survey for January is expected to remain unchanged, a potential sign that the Australian housing market is starting to lose steam.
Accordingly, data shows that the ratio of house prices to rents is 56 percent overvalued; in the United Sates, that same ratio is only 3 percent. A poor reading would be a confirmation of our general bearish bias towards the Aussie, and perhaps a warning sign of things to come.

The key question remains is “whether broader geopolitical turmoil may be enough to force a more sustained shift in ‘risk’ and a commensurate correction in financial market sentiment,” as David Rodriguez said last week.Should political unrest continue in North Africa and Spread to the Arabian Peninsula, the markets could enter a ‘risk-off’ stage, this would be the fundamental trigger needed for a sharp AUD/USD pair correction.

Ely, while I agree with your bearish sentiment ... I do feel that there needs to be a push to at least 1.0220/5 to blow off stops that have been building in recent days (retail stops at least)

Totally agree with you Warwick...but its been there or thereabouts several times before, so yes it could again, or it couldn't...who knows. It is at present over 30% over-valued, and the damage to Aus businesses is catching up!

"The Australian Dollar remains the most overvalued currency against its US counterpart, hovering at a staggering 31.7 percent above PPP-implied fair value and just off record highs. The fuel behind such performance came from an undeniably hawkish RBA however, which no longer seems to be the case. While markets are still pricing in some tightening this year, that outlook looks increasingly vulnerable as China – Australia’s chief trading partner – pulls harder on the brakes to check inflation. This coupled with lingering headwinds from the Queensland floods and Cyclone Yasi hints as well as the likelihood of renewed sovereign stress in Europe, an outcome that is likely to dent broad sentiment along with the risk-linked Aussie, hints a downward correction may be forthcoming."

I would like it to touch that mark which is why i have a short placed there..but as always, no matter whether its stocks or forex..nothing goes UP or DOWN in a straight line.

I have only been long on 6 occasions, but don't really have the balls to go long, cos, once this turns, i think it'll leave everyone for dust!

Saudi Revolution on its way...buckle up!
Can't believe these idiots think they own the country outright...no demonstrations allowed, crackdowns etc...all the laws that THEY have made & passed themselves, are for the good of the rulers, and to assist them in staying in power!

http://twurl.nl/1aswy7

This is my view simple and straight forward (without any noise).



More then happy to buy dips.

Cheers

simple but a little confusing,
no problem, which is important to profit,

Hell! Hell I tell you! I world without chocolate is a world not worth living in!

.lol.
slowly bro,,

http://twurl.nl/xcregz

"Cracks have appeared once again. Over the last few months, sellers have been slowly coming out of the woodwork and buyers are biding their time. As a result, auction clearance rates have plummeted and prices have once again started falling. According to RP Data, there has been no capital growth since May 2010 and capital city values fell 1.6 per cent (seasonally adjusted) in January.

But that’s just the start. Next up, we have Fear, Capitulation and Despair. The Blow off Phase will be slow and steady, but brutal – wiping out all the gains of the last 15 years and not just returning to the long-term trend, but falling below it."

Hey ely,

Why don't you post some charts to back up all your propaganda news?
I look at my chart and see bulls but having said that if I turn my screen by a 180 degrees I can also see the bears. So please if you make calls back it up with some history such as charts.

Thank you.

Cheers

Not sure if the current uptrend will continue, however, this is what I see....couuld be wrong....

i am still being a watcher, letting this rise to 1.018..... let starting to put some shorts.....

I'm personally looking for 80 by Summer. But 1.04 first.

ely is bit copy what others say,

at the momentm, all the technical/fundamental analysis are bxxx sxxx.

my feeling is the market is waiting for the real chinese news, tightening economy or stable improving economy, at the moment even the mining company is withholding.

I started analyzing AUD/USD since 09/2010, on this pair i'm using a simple statistical method, and at the moment is pointing down, not so steep as your graph implies (I understand you handn't a lot of room ).

Bottom line, i sense a behaviour change, imho market must turn south, it's (at the moment) unlikely that the market finds enough buyers to keep the AUD above 1.02, we need to go down to fetch new passengers... Or not!

Great time to get in...long.

Green is TP should make a swing high at that line.

Why is it propaganda...do you think i give a cats left nipple! I don't need to put a chart to back my arguement, the chart can be read as you want to read it!
Its either overbought ready to drip, on an uptrend, or exhausted etc. Either way, imo, its virtually ready to turn...but that doesn't mean it won't go higher yet!
My point is that cracks are appearing, and its the speculative positions holding this at the mo...when the tide turns, its game over!


http://twurl.nl/61z7rf

Finally, Here Comes the Price Crash…
by KRIS SAYCE on 1 MARCH 2011

"The so-called deleveraging that the mainstream told you had happened in 2009 and 2010 never happened. Credit continued to soar in the belief that Australia was immune to global problems. Australian household debt now stands at over $1 trillion.

But now there’s nowhere left to go.

And that means the great deleveraging has arrived.

The Ponzi scheme that is the Australian housing market is on the verge of collapse."