Weekly Analysis - Tracking the Aussie movements
(by Eugene Voon)
In the coming week, the following major Australian economic news will be released. Monday, 6th July Institute for Supply Management (ISM) releases Non-Manufacturing PMI. The current forecast is 50.0 which is higher than last month’s 45.4. A higher value represents industry expansion which would be good for AUD. Cash Rate and RBA Rate Statement will also be released on Tuesday, 7th July. Traders should ensure risk is managed properly as news events can cause volatility in the market.
AUDUSD Daily Chart
From middle of last week till close of the week, AUDUSD managed to push higher and reach the 0.6937 region. This broke the downward channel we had drawn last week and indicates the lack of selling pressure. Traders who wish to take a trade will have to zoom into lower timeframes for hints to the direction the market could be heading to.
AUDUSD H4 Chart
As seen on a zoomed in H4 chart, price formed a larger bullish candle at the red arrow which closed higher than the opening price of the previous bearish candle. This was a warning sign that price could break above the trend channel.
AUDUSD H1 Chart
Traders looking to trade AUDUSD can potentially take the potential bearish Deep Gartley that may complete on the H1 chart. For this trade, B and C points are a little close for our liking but it is still a potential trade albeit less than ideal structure.
AUDJPY H4 Chart
This week on AUDJPY, price moved back up to the previous reversal zone. As AUDJPY has positive correlation to AUDUSD, traders are advised to be cautious when trading the pair. Traders with open trades on this pair should ensure they have stops in place in the event that AUDJPY ends up moving even higher since AUDUSD currently has a slight bullish bias.
AUDJPY H1 Chart
Likewise, on the H1, AUDJPY has a potential Deep Gartley that could potentially complete. This Deep Gartley also has less than ideal structure but would possibly have better risk to reward ratio. Traders who wish to trade this can reduce risk through lower position sizing. A good level for stop loss could be slightly above the right shoulder of the head and shoulders that had been identified previously.
GBPAUD Daily Chart
GBPAUD has yet to complete the Bullish Bat pattern and could possibly complete this week giving the bullish bias on the AUD. Traders can look for hints on when to enter using a lower timeframe. For now traders should wait for completion of the pattern.
GBPAUD H1 Chart
Being completely speculative here, for a harmonic Deep Gartley to form. For this pattern to form, price will have to move higher to complete the BC leg before moving back lower to complete the pattern. Traders who wish to take a trade may do so. However, traders will have to mindful of the larger pattern on the daily chart.
Good luck everyone. Trade right and trade safe, the profits will come rolling in naturally.
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