It’s easy to see why there could be some serious volatility. Which way are you guys playing it?
I’ve seen some potential set-ups as shown in below charts - please let me know what you think
First up is AUD/NZD - price has pushed above 11000 level on daily chart and has potential to rise to 11350-11400 level with some good data - NZD is also seeing bearish pressure at the moment due to bank of new zealand feeling that their currency is too high.
However, whilst MA’s and MACD are showing bullish momentum the RSI is in oversold territory - my thoughts on this one are to exercise patience and look for a retest of the minor broken resistance level which should bring RSI back into a good area - this will also give me some breathing room for first big announcement on Monday - Ozzie interest rate meeting - are you thinking of trading this one or already in?
My second trade idea is AUD/CAD which appears to have broken upper descending trendline and pulled back for a retest - now waiting on indicators to give me the go-ahead
However, some really good Cad data came out today which is why this one has swung lower - this may continue to put bearish pressure on this pair with more major canadian data out wednesday and friday.
Seems like it is a wait for data to give me direction
I hate fundamentals. I figure billions are spent with brains smarter than mine on buy side sell side research. And if they can’t get it right, what hope have I.
My outlook, too. I figure that if I trade from charts I can have the same information as them, and arrange it however I wish to, to try to take advantage of it, but if I try to trade from fundamentals, I’m way behind them to start with in many ways, with little hope of taking advantage of anything at all.
Interesting thoughts - do you guys not think it is worth using the charts to view potential set-ups and then look ahead to news reports to understand what might be the catalyst? Also is it not worth understanding overall sentiment on a currency when trying to decide which way to trade it?
Hello everyone. By no means am I very knowledgeable on trading. I’m learning a lot from this site. But after taking a look at the AUD/NZD Daily chart. Should this pair not be looking for a retracement here shortly? I show the RSI and Stoch showing overbought. What are your thoughts?
It is possible as you say that a retracement could be on the cards - you correctly pointed out that the rsi showing overbought and this could well be a sign that we will see bearish pressure on the AUD - however both MACD and MA’s are signalling bullish momentum at the moment so I think we would have to wait for confirmation from them as lagging indicators.
There are a lot of reports coming out this week from the land down under so direction will certainly be given along with Chinese data - Australia’s biggest trading partner.
I think if we do see negative pressure there is a good chance price will retrace to the 11000 level - an area of strong previous support and resistance - but I believe again we need to wait for indicator confirmation before placing the trade.
It is also possible that we will see price bounce off of the current level which was an area of support back in April 2015
We can see on the 4 hourly that the MACD and RSI are currently showing bearish momentum but that can quickly change and this would allow for the RSI on the daily chart to head back up to that 80 level which it has done in the past.
For me I am going to exercise patience as lots of volatility can be expected - If I trade it I will trade the 4 hourly chart to give myself better risk to reward. If negative pressure is seen I will wait for price to retrace to the 11,000 level and try and get in here.
I have to be honest - even if price pushes above previous high at 11140 I don’t think I would trade this pair - I would look to get in a different AUD cross with more potential for reward - e.g. AUD/CAD is showing an interesting pattern at the moment.
I am certainly learning at the moment as well - all of what I just said could be total crap - but it is my thought process - thoughts on this one guys?
