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FOREX Chart Of The Day: Watch Out For This Key Level On AUDUSD

Is the AUDUSD downtrend going to continue? And if so, what levels do we need to watch out for trend continuation set ups?

In this video, we identify a key level to watch and what could happen next for the major forex pair.

Watch the video to find out more…

Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, Head Currency Analyst.

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In this video, we’re going to take a look at AUD/USD as there could be a potential short opportunity.

Aussie is moving lower in the strength meter. We identified that in this week’s Forex Market Outlook. We also determined that the US Dollar is flatlining a bit, but still pushing to the upside. This suggests that we could see a AUD/USD downside.

Daily time frame

Looking at the daily time frame, we can see that the price is making lower lows and lower highs after it formed this nice little double top pattern.

Now, we’re starting to break down. Where will the market likely go? Previous structure lows are just through here. We have a decent support level around 7600, where the price may find some support again.

You can see that it has strong support here, and a bit of resistance there. Is that going to act as support once more?

When we look at these daily time frames, we’d like to identify where the trend is and what phase we’re in. We’re currently in the impulse phase of this move. So, I want to identify my trend in the four-hour timeframe.

Four-hour timeframe

So, we’re going to the four-hour timeframe now. We can see that the trend is also confirming a slight move to the downside. We know this because we’re getting lower lows and lower highs.

Now, because the price consolidated in this area, I want to short the pullback of the lower lows that the price made in this zone.

The highest traded level within this zone is 7741. That means that in this area, whoever is involved will have put high volume levels through on this point. So, if the price were to get back to 7741, I’d expect them to defend their positions and push prices lower.

For me, 7741 is a crucial resistance level on this move. If the price can get to this area and hold at this point, you can either look to this level as a resistance point or go to a lower time frame and watch the trend. But if the price holds here, I want to be looking for shorting opportunities on AUD/USD down into this key area. If it breaks through this area, look for further downside.

AUD/USD is looking good. Trends are looking great; we can see that we’ve also broken through this recent trend line support, which is all adding to the potential for this market to move lower.

We also had that nice 23.6 close. When you see that market close below 23.6, that’s when you want to short and see the trend change, which it did. The market is now moving nicely to the downside.

Keep an eye on this 7741 area. It has a really nice high volume level where sellers could re-enter the market.

Thanks for watching this video update, and I’ll speak to you in the next one.

Get a feel of trading while looking out for AUD/USD trends with a demo trading account. Blueberry Markets offers a free demo account with up to $50,000 seed fund for practice. Click here to sign up. Our highly-committed customer support team will be at hand to help you have a hassle-free trading journey.


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