Thoughts on the Aussie...

3 Eyl 2017

Weekly gain/loss: + 35 pips
Weekly closing price: 0.7963

Since weekly price linked with the support area at 0.7849-0.7752 three weeks ago, the commodity currency has remained reasonably well-bid. The next objective, assuming that price continues to push north, can be seen around resistance drawn from 0.8075. Before weekly action can reach the noted resistance, however, it may be worth noting that daily price must first consume both Quasimodo resistances seen at 0.7980/0.8030.

A disappointing US job’s report on Friday saw H4 candle action run through the mid-level resistance at 0.7950 and touch gloves with the daily Quasimodo resistance mentioned above at 0.7980. Although this daily line could potentially drag the pair lower today, we really like the look of the large psychological level planted just above it at 0.80, due to the following nearby converging structures:

• August’s opening level at 0.7998.
• A H4 Quasimodo resistance level at 0.8007.
• A H4 161.8% Fib ext. point at 0.8008.

Suggestions: A short from the green H4 sell zone is, in our technical opinion, appealing, given its confluence. To trade this area though, we would ideally want to see H4 price whipsaw through the current daily Quasimodo resistance and test the zone in the shape of a pin bar, and ultimately close on/near its low (as drawn on the H4 chart). The reason we require this candle confirmation is due to both the risk of a fakeout being seen up to the daily Quasimodo resistance at 0.8030, and weekly price currently showing room to extend up to weekly resistance at 0.8075.

Data points to consider: No high-impacting news events on the docket today (US banks are closed in observance of Labor Day).

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: 0.8008/0.7998 (ideally we want to see price whipsaw through the current daily Quasimodo resistance and test the zone in the shape of a H4 pin bar, stop loss: either beyond the candle’s wick or above 0.8008).