Aussie did bounce to target 1.0400 yesterday in the afternoon, reaching 1.0405. This was enough for Aussie Bears and strong selling pressure breached 1.0338 ad 1.0310 and we have been to 1.0298. Now we have quite good support at 1.0276 today and if we reach this target we see sellers covering all their short positions.
We would expect a small bounce off this support as it is quite a good technical support and both the 240 and 60 min charts will be looking quite oversold by this point. Join buyers as they try and correct the recent declines... However...as we know if a market wants to trade lower it ignores oversold conditions and trades to the next level. So a break of 1.0270 sees us trading lower to 1.0255/45. Here we view to cover all shorts. Re-instate small longs, keeping stops tight below 1.0240.
Now if we can hold 1.0276 and more importantly trade and hold back above 1.0310 there is scope for correction and above 1.0340 will lead us higher to 1.0375/1.0400 where once more we look to sell the Aussie.
The article was first published by CharmerCharts