The AUDUSD corrected higher today and tested the 38.2% retracement of the weeks move down at the 0.95577 level. Sellers were happy to use the level to define risk. The holding – especially in the trend type market the pair has been trading in – gives added confidence to the bears.
The weaker US employment reports today helped pushed the pair down to the NY lows at 0.9716. However, the intraday traders used the 200 bar MA on the 5 minute chart, and 50% midpoint of the days trading range at the 0.9716 as a level to lean against for a low risk trade from the buy side (see chart below).
So the pair has found the happy zone where intraday buyers can take a shot against a technically defined level, and sellers looking to get on the trend have their low risk trade against their risk defined level. Look for the range to be respected until that time when an extreme is breached. On a break, look for momentum in the direction of the break.
