AUDUSD Daily GAP-2 trendy13JAN09 Pair has broken a medium term trendline and may be setting up for a good short trade. Stop would be above recent high. Since the pair is divergent on the 60M, I prefer waiting to see if this happens, possibly taking the divergent trade, and then taking the short trade if it sets up with a better risk/reward (smaller stop loss). Goal is lower trend line. (see AUDUSD divergent trade post for 1HR chart setup).
I am back in this trade. Updated chart is below. I was up 90 + pips and it retraced during the mid Asian session leading up to 21:00 est, but now is retracing again. If this does not break the congestion tonight I will not keep chasing this trade. It was a good run either way.
Updated AUDUSD Gap trade as of 21JAN09 20:45:
Tuesday 20JAN09 – The pair did break the near term mid-resistance line I drew yesterday, but it did not cross the recent low which was significant resistance on the other move down to this level. I took a small testing possition and was stopped out on a bounce off the mesa line. I will wait to see if it can close below this area on the 1 hour with a convicted candle before retrying this trade.
Monday 19JAN2009 – midway through the Asian session, it looks like we are setting up for possibly another shot at this trade. The first time it reached 1/2 of the way and retraced to the 200 on the 60M. Will we break through and get to the green lower support TL?
I think if we can ride the Obama mania train for the European session we have a great shot. We’ll see. All the USD related trades today setting or triggering are in my mind the same trade – short term USD strenghthening due to election relief and the current global love affair with our soon to be new President. I expect this will be a very short trading window and if it holds through the European session, all bets are off after tomorrow. I am hoping for some good trending once the market decides it’s short term take on the new pres.
Here is the updated chart: