Talking Points
AUDUSD opening range takes shape above key support
Scalp bias bearish sub-9440
Event risk on from China, US & Australia
AUDUSD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
AUDUSD reversal off Fibonacci resistance / weekly key outside reversal last week- bearish
Monthly opening range set between 9330-9500- bearish invalidation
Key support 9307/9337- bullish invalidation
Subsequent support targets at 9208/18, 9080
Breach above June ORH targets objectives at 9568, 9620
Daily momentum divergence / support trigger break- bearish
Event Risk Ahead: Chinese Inflation data tonight and FOMC Minutes & Australian Employment tomorrow
AUDUSD 30min Chart
Notes: Last week’s key outside weekly reversal candle at Fibonacci resistance shifts our broader focus to the downside for the Aussie. With that in mind, there remains some key support barriers the pair would need to get through to validate the reversal, the first of which is the 9308/37 support zone. With the monthly opening range now set, we’ll look for a break of this region to validate our bias heading into the close of July trade with short scalps favored sub-9440.
Bottom line: we’ll look to sell rallies while below the monthly high with only a breach invalidating our medium-term bias. Divergence on the intra-day momentum signature suggests the pair may be vulnerable for a turn-over heading into Asia trade. Caution is warranted heading into the middle of the week with Chinese CPI data tonight and FOMC minutes/Australian employment tomorrow likely to fuel added volatility in the pair. Follow the progress of this trade setup and more throughout the trading week with DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets
Timeframe
Level
Technical Relevance
Resistance Target 1
30min
9415
50% Retracement
Bearish Invalidation
Daily / 30min
9437/42
61.8% Retrace / June, Nov Swing Highs / (7/2 close)
Break Target 1
30min
9460/66
78.6% Retracement / April High / Weekly R1
Break Target 2
Daily / 30min
9498-9504
76.4% Retracement / July ORH
Break Target 3
Daily / 30min
9568/75
1.618% Extension / Weekly R2
Break Target 4
Daily / 30min
9618/32
50% & 88.6% Retracement(s) / Oct 23rd Close
Support Target 1
30min
9395
38.2% Retrace / Asia High
Support Target 2
30min
9369
23.6% Retracement
Bullish Invalidation
Daily / 30min
9337/40
Weekly, July ORL / 61.8% Retrace / TL Sup / 50DMA
Break Target 1
Daily / 30min
9321
61.8% Retrace / June Swing Low
Break Target 2
Daily
9308
100% Ext / July 2013 High (9317)
Break Target 3
30min
9271
78.6% Retracement
Break Target 4
30min
9242
88.6% Retracement
Break Target 5
Daily / 30min
9207/17
61.8% & 50% Retrace / 78.6% Ext / April, May Low
Average True Range
Daily (20)
58
Profit Targets 15-17pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
EURUSD July Opening Range Play- Shorts Favored Sub 1.37
AUDCHF Rebounds Off Key Support- Longs Favored Above 8360
GBPJPY Testing Key Inflection Zone- Shorts at Risk Above 172.70
GBPCAD Scalps Target Weekly Range- Bullish Bias at Risk Sub 1.8480
GBPAUD Scalps Favor Buying Dips Post June Range Break
GBPNZD Weekly Opening Range Play- 1.96 Resistance in Focus
AUDJPY Long-bias at Risk Sub 96- BoJ / China Data On Tap
EURAUD at Fresh 2014 Lows- Reversal Risk High Above 1.4420/40
—Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
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Source: Daily fx