AUDUSD has dropped and is testing major support. We look to sell if it breaks this support level.
Sell below 0.7781. Stop loss at 0.7819. Take profit at 0.7717.
Reason for the trading strategy (technically):
Price is testing major support at 0.7781 (Fibonacci retracement, horizontal overlap support, ascending support) and a break of this level would open a bigger drop to 0.7177 support (Fibonacci extension, horizontal swing low support).
RSI (34) can also see a long term bearish descending resistance line holding price down and a recent bearish exit of our short term ascending support-turned-resistance line is signalling a potential drop from here.
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Desmond Leong provides technical analysis to the largest banks, hedge funds, and brokers whilst coaching hundreds of aspiring traders. He specializes in providing actionable and accurate analysis that utilizes the most advanced theories.
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