Comdoll traders huddle up!
We’ve got back-to-back comdoll setups lined up for ya today.
Last week we talked about AUD/USD hanging out at a channel resistance area while sporting a divergence on the 1-hour time frame.
It looks like the Aussie bears who bet on a downswing got about 50 pips before AUD/USD retested the trend line resistance!
After another trend line rejection, AUD/USD looks ready for another move lower. Will it make new June lows in the next trading sessions?
Shorting at current levels would still give you a decent risk ratio especially if you place your stops just above the trend line and AUD/USD drops down to its June lows or even the .7680 previous support level.
If it looks like the bears have run out of steam, though, then you should also prepare for a breakout above the trend line resistance that coudl take AUD/USD to the .7800 area of interest.
Do you remember the Head and Shoulders play that we looked at last week? If you do and you traded the setup, then you’ll know that NZD/JPY has broken below the “neckline” that we spotted.
The pair is now flirting with the 79.20 area, which lines up with a key resistance from late April to May. And look, the level is also around a key trend line resistance, a 50% Fib retracement, AND the 100 SMA on the 4-hour time frame!
I’m not seeing momentum going in either direction yet, so you still have time to watch and plan your steps for when price action heats up.
A bounce from the trend line support opens NZD/JPY to a move back to its 80.20 May highs or even new Q2 2021 highs.
A break below the trend line, however, makes the 200 SMA and the lower Fib levels the next areas to watch. If the bears get enough momentum after the downside breakout, then NZD/JPY could drop to the 78.00 or 77.30 previous inflection points.