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AUD/USD Technical Analysis October 11, 2011

By:
Christopher Lewis
Updated: Jan 1, 2011, 00:00 UTC

The Aussie continued to power forward during the Monday session as traders continue to take on the “risk on” trade globally. The Aussie is very sensitive

AUD/USD Technical Analysis October 11, 2011

The Aussie continued to power forward during the Monday session as traders continue to take on the “risk on” trade globally. The Aussie is very sensitive to global risk, so this move is to be expected. When the stock markets and futures market rise, so does this pair – most of the time that is.

However, we approached the “parity” level during the late hours of the day, and it did stop right at that level. Parity levels are special because they represent the “biggest of the big numbers”. This large psychological number normally produces some kind of reaction, and we expect this time to be more of the same.

As the economic headwinds out there are too many to count, we think this pair has an easier time going down than up over the longer-term. Because of this, we are selling rallies that show signs of exhaustion on smaller time frames. This area we find ourselves in at the moment is a perfect place to look for that. Unfortunately, we have not seen that yet. We will be looking for 4 hour bars, and perhaps daily ones if we get them that suggest selling the pair. We are not going to buy as the dangers are too numerous at the moment. We are sellers, but are still waiting for our signal.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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