My Picks: Short AUD/USD
Expertise: Elliott Wave, Technical Analysis
Average Time Frame of Trades: 2 Days – 2 Weeks
After a strong sell off in 2013-2015, AUD/USD began to consolidate those losses in September 2015. During that time, we have seen open interest in trading the pair slowly drift lower as the trend quieted down.
For the past 3 months, AUDUSD has quietly carved two bearish patterns in a row which offers an opportunity to position short.
Market Interpretation: Retracement
Bias: Short AUD/USD
Entry: Near .7520 – .7600
Stop Loss:Near .7680 (-80 to -160 pips)
First Target: .7000 (+520 pips)
Second Target: .6500 (+1,020 pips)
Secondly, as price chopped through the A-B-C correction, open trading interest in the pair plummeted. Traders typically try to pick tops and bottoms. However, they also tend to chase after tops in bottoms in strong trends. As AUD/USD consolidated, their interest in trading the pair waned.