Potential three-drive formation observed on AU, traders...
AUD/USD:
In the early hours of Tuesday’s segment, the Reserve Bank of Australia (RBA) in its February meeting minutes announced members agreed there was not a strong case for a near-term adjustment in monetary policy. This sent the AUD/USD lower, setting the intraday tone for Asia. It was not until US traders opened their doors for business did the market observe a rotation higher.
Leaving the 0.71 handle on the H4 timeframe unchallenged, the commodity-linked currency gravitated higher vs. its US peer, shattering the session high for the day at 0.7160 and clocking a peak of 0.7173. What’s notable on the H4 timeframe, from a technical standpoint, is the demand-turned resistance area at 0.7204-0.7186, which holds within it a 61.8% H4 Fibonacci resistance value at 0.7184 and the 0.72 handle. In addition to this, a three-drive formation (pink arrows) visibly completes around 0.7187. It might also be worth noting the H4 RSI indicator is seen fast approaching its overbought value.
Another factor in favour of the aforesaid H4 zone is the weekly timeframe’s 2017 yearly opening level residing around the 0.7199 region. Daily structure, however, shows price trading within the upper band of a demand-turned resistance zone at 0.7138-0.7176. A break above this area has resistance at 0.7231 to target, which is positioned beyond the current H4 demand-turned resistance zone.
Areas of consideration:
A selloff from the H4 demand-turned resistance area at 0.7204-0.7186 is high probability today, in view of its surrounding confluence. With stop-loss orders tucked above 0.7204, we could be looking at a run towards yesterday’s lows of 0.7103 as an initial take-profit target.
Today’s data points: FOMC Meeting Minutes.
In the early hours of Tuesday’s segment, the Reserve Bank of Australia (RBA) in its February meeting minutes announced members agreed there was not a strong case for a near-term adjustment in monetary policy. This sent the AUD/USD lower, setting the intraday tone for Asia. It was not until US traders opened their doors for business did the market observe a rotation higher.
Leaving the 0.71 handle on the H4 timeframe unchallenged, the commodity-linked currency gravitated higher vs. its US peer, shattering the session high for the day at 0.7160 and clocking a peak of 0.7173. What’s notable on the H4 timeframe, from a technical standpoint, is the demand-turned resistance area at 0.7204-0.7186, which holds within it a 61.8% H4 Fibonacci resistance value at 0.7184 and the 0.72 handle. In addition to this, a three-drive formation (pink arrows) visibly completes around 0.7187. It might also be worth noting the H4 RSI indicator is seen fast approaching its overbought value.
Another factor in favour of the aforesaid H4 zone is the weekly timeframe’s 2017 yearly opening level residing around the 0.7199 region. Daily structure, however, shows price trading within the upper band of a demand-turned resistance zone at 0.7138-0.7176. A break above this area has resistance at 0.7231 to target, which is positioned beyond the current H4 demand-turned resistance zone.
Areas of consideration:
A selloff from the H4 demand-turned resistance area at 0.7204-0.7186 is high probability today, in view of its surrounding confluence. With stop-loss orders tucked above 0.7204, we could be looking at a run towards yesterday’s lows of 0.7103 as an initial take-profit target.
Today’s data points: FOMC Meeting Minutes.
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