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AUDNZD Technical Entry
Despite the limited time to enter the trade we have selected AUDNZD as our trade alert ahead of the Australian employment data at 01:30am GMT. We have been monitoring the FX cross for quite some time and believe the current levels are best suited for short trade with a tight protective stop loss order.
AUDNZD Weekly Chart
Please click on the chart to enlarge:
AUDNZD Weekly Chart 07/08/14
The weekly chart shows how AUDNZD has been held in a tight range with the price currently testing the upper resistance. Although it may appear we are basing the trade on the weekly chart, we simply use it a confirmation to the daily and 4hr entry we have based on our technical models. Shorting the Aussie often involves incurring a high negative swap but the Kiwi soften the hefty interest.
AUDNZD Daily Chart
AUDNZD Daily Chart 07/08/14
The daily chart has painted a classic double-top reversal pattern with minor negative divergence in the technical indicators. There is a moderate potential a whipsaw reaction to the employment data, taking the Aussie higher before posting a swift retracement. We are willing to absorb the drawdown should it take place due to the decent Risk Ratio (RR) of the short trade. AUDNZD has the potential for retracing over +300 pips within a relatively short period of time, which is why we are attracted to taking the trade despite its close proximity to the Australian economic data.
AUDNZD Trade Details
Short @ market price
Take profit: 1.0778 (61.8% Fibo)
Protective stop: 1.1108
Estimated duration: 14 days
Risk Ratio (RR): 1 : 3.1 (approx.)
Any updates to the above trade will be posted at the bottom of this page.
07/08/14 UPDATE: AUDNZD trades at 1.0997 at the time of this writing. We are closing 20% of the trade at market price, shifting the protective stop to the entry.
07/08/14 UPDATE II: AUDNZD daily chart following the employment data. Click on the chart to enlarge:
AUDNZD price following the employment data
07/08/14 UPDATE III: As the bearish slide continues, AUDNZD trades at 1.0986 at the time of this writing. We are closing 10% of the trade at market price.
07/08/14 UPDATE IV: AUDNZD is trading at 1.0940 at the time of this writing, taking the short trade into a profit of approximately +90 pips. We are shifting the protective stop to 1.1014 and close 30% of the short trade at market price.
08/08/14 UPDATE: AUDNZD is trading at 1.0947 at the time of this writing. We are shifting the protective stop loss order to 1.1005.
12/08/14 UPDATE: AUDNZD is trading at 1.0948 at the time of this writing. We are were the NAB Business Confidence is due in several hours, which is why we liquidating 15% of the trade at market price.
12/08/14 UPDATE II: AUDNZD triggered our protective stop. We have ended the trade with a decent profit.
Trade alerts are also issued in the weekly update.
