Waiting for a Washout to Cover AUDUSD

By Roger Baettig | May 14 2012 10:27 AM

IN GENERAL - The global growth slowdown trade continues to work. Crude and copper are off 2% to start the week while the USD and JPY are up. The next level of interest for crude is a November pivot below 9100. Copper is trading at its lowest level since January and the 2012 low at 3.3925 is significant. Expect a free fall type decline if that level gives way. The same can be said for gold and its December low.

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As for the AUDUSD short, price is testing a confluence of channel and trendline support. I continue to look towards 9861 as long as price is below last night's high (10040). Exceeding that level would shift focus to 10090. Regarding timing, an early week 'flush' lower would allow for us to cover and return short on a bounce. Again, 9840/60 is what I am looking for, maybe tonight on RBA May minutes?

Look lower towards 7740 (2012 low) and 7652 in the NZDUSD as long as price is below 7825.

Watch the EURUSD as it approaches potential channel support near 12800. A drop below the channel would set sights on the January low. Last night's high at 12905 is now the pivot. 12850 is resistance.

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Gold, Copper and Crude Continuous Futures (Daily)

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