With China’s trade balance coming in at -60.4 billion CNY versus 172.5 billion expected, the Aussie dollar responded bearishly. Additional selling was seen during the early hours of London, which, as you can see, was later fuelled further by a better-than-expected US ADP print. As can be seen from the H4 chart, the pair has settled around the top edge of a H4 demand area at 0.7493-0.7518 and is, for the time being, holding firm.
Looking over to the bigger picture, it’s clearly seen that both the weekly and daily charts are trading within supportive structures at present (weekly support area at 0.7524-0.7450/Daily demand at 0.7511-0.7543). Because of this, we feel that there’s a good chance price could advance north from the current H4 demand base today and at least tap the underside of the H4 mid-way resistance at 0.7550.
Our suggestions: While a buy from the present H4 demand is tempting, there’s not much room to play with before price strikes 0.7550 (27 pips at current price). As such, an ideal scenario would be for the H4 bears to drive a little deeper into the aforementioned H4 demand, before looking to go long. Our cue here would be a reasonably sized H4 bull candle seen within the walls of this region.
Data points to consider: Chinese inflation data at 1.30am. US jobless claims at 1.30pm GMT.
Looking over to the bigger picture, it’s clearly seen that both the weekly and daily charts are trading within supportive structures at present (weekly support area at 0.7524-0.7450/Daily demand at 0.7511-0.7543). Because of this, we feel that there’s a good chance price could advance north from the current H4 demand base today and at least tap the underside of the H4 mid-way resistance at 0.7550.
Our suggestions: While a buy from the present H4 demand is tempting, there’s not much room to play with before price strikes 0.7550 (27 pips at current price). As such, an ideal scenario would be for the H4 bears to drive a little deeper into the aforementioned H4 demand, before looking to go long. Our cue here would be a reasonably sized H4 bull candle seen within the walls of this region.
Data points to consider: Chinese inflation data at 1.30am. US jobless claims at 1.30pm GMT.
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