AUDUSD Returns to Sunday Open; Resistance Extends to 10165

DailyFX   |  May 10 2012 10:08 EDT

Work down from larger degrees of trend. Markets (crude, copper, equities especially small caps, and commodity FX) are on the way down after forming multiyear topping patterns. Many of these topping patterns take the form of head and shoulders tops. Strength should be sold.

FXCM Expo Videos

Innovative Techniques with Traditional Technical Indicators

Trading with the Elliott Wave Principle

Seeing the Forest from the Trees: An Analysis of Global Markets

Afternoon Technicals (all charts)

Other TA (crosses, COT, etc.)

IN GENERAL – Work down from larger degrees of trend. Markets (crude, copper, equities especially small caps, and commodity FX) are on the way down after forming multiyear topping patterns. Many of these topping patterns take the form of head and shoulders tops. Strength should be sold. From a timing perspective, pay attention to the opening range for respective markets (early Asian session for AUDUSD and NZDUSD). Map out your levels and know what you will do when that price is reached. Beware of rumors and event risk, which often result in countertrend spikes (best to fade these spikes). If you want to learn more about specific timing strategies (opening range for example) and my trading, then join my next week for a trading bootcamp.

Most of the AUDUSD short was exited last night on the break above the Asian opening range. It was the first time that price had held and broken above the Asian opening range since May 4th. Price has entered the 10135/65 resistance zone (5 day average and short term pivot on Tuesday) mentioned last night on Twitter. Keep an eye on resistance in the AUDNZD (12890) and the S&P (1370/75 for e-mini) for help in position sizing and timing the AUDUSD. 9975 and 9860 are the next bearish objectives.

AUDUSD Spot Weekly

Prepared by Jamie Saettele, CMT

NZDUSDSpot Weekly

Prepared by Jamie Saettele, CMT

Crude (top) and Copper (bottom) Weekly Continuous Futures

Prepared by Jamie Saettele, CMT

To contact Jamie e-mail jsaettele@dailyfx.com. Follow me on Twitter @JamieSaettele

To be added to Jamie’s e-mail distribution list, send an e-mail with subject line "Distribution List" to jsaettele@dailyfx.com

Jamie is the author of Sentiment in the Forex Market.