U.S. Markets closed

Australian Dollar Chops Around - Watch Critical Support for Next Move

David Rodriguez


ssi_aud-usd_body_Picture_19.png, Australian Dollar Chops Around - Watch Critical Support for Next Move

AUDUSD – A substantial shift in retail forex positioning in the Australian Dollar warns that the most recent breakdown versus the US Dollar may be the start of a larger sell-off.



Trade Implications – AUDUSD: Last week we wrote that we were plainly in favor of fresh AUDUSD-long positions as our sentiment-based Momentum2 bought from $1.0472. If the facts change, however, we must change. Retail traders have since bought aggressively into AUDUSD weakness; long positions are up a substantial 83 percent since last week while short orders have fallen 31 percent.


The same SSI-based trading strategy is now short AUDUSD from $1.0300, while our volatility-friendly Breakout2 strategy has likewise sold from $1.0326. We’re most often hesitant to flip direction on a specific currency pair so rapidly; it leaves us susceptible to getting chopped out in both directions. Yet a break of key support at $1.02 would further cement our AUD-bearish trading bias.


--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com


Download all of our Sentiment-based trading strategies free via an ongoing promo on FXCMApps.com


To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up for his distribution list via this link.




ssi_aud-usd_body_1a_5.png, Australian Dollar Chops Around - Watch Critical Support for Next Move

View how to automate the high-volatility Breakout2 Trading System via our previous article and webinar recording.


Auto trade the trend reversal-trading Momentum2system via our previous article and webinar recording.


Trade with strong trends via our Momentum1 Trading System and view an archived webinar


Use our counter-trend Range2 Trading system and view an archived webinar guide on automation


New to FX markets? Learn more in our video trading guide.


Contact David via

Twitter at https://www.twitter.com/DRodriguezFX

Facebook at http://www.Facebook.com/DRodriguezFX


DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.