HomeTrade IdeasElliott Wave DailyTrade Idea: AUD/USD - Buy at 0.7870 or sell at 0.8030

Trade Idea: AUD/USD – Buy at 0.7870 or sell at 0.8030

AUD/USD – 0.7973

Recent wave: Wave 5 ended at 1.1081 and major correction has commenced for fall to 0.7000 and then towards 0.6500-10

Trend: Near term up

Original strategy :

Buy at 0.7880, Target: 0.8080, Stop: 0.7820

O.C.O.

Sell at 0.8020, Target: 0.7880, Stop: 0.8080

Position: –
Target:  –
Stop: –

New strategy :

Buy at 0.7880, Target: 0.8080, Stop: 0.7820

O.C.O.

Sell at 0.8030, Target: 0.7880, Stop: 0.8090

Position: –
Target:  –
Stop:-

Aussie’s retreat after last week’s rally to 0.8066 suggests the wave iii top is possibly formed there and consolidation with mild downside bias is seen for correction in wave iv, hence weakness to 0.7900 is likely, however, reckon previous support at 0.7875-78 would hold and renewed buying interest should emerge there, bring another rise later. Above said resistance at 0.8066 would signal recent upmove is still in progress for headway to 0.8100, then 0.8140-50 but overbought condition should limit upside to 0.8190-00, bring retreat later. We are keeping our latest bullish count that recent impulsive waves is unfolding as (1 2, (i)(ii), i ii) and may extend headway to aforesaid upside targets. 

In view of this, whilst we are looking to buy aussie on subsequent pullback, we would turn short on recovery as 0.8020-30 should limit upside. A sustained breach below support at 0.7875 would defer and risk correction to 0.7810-20, however, still reckon downside would be limited to 0.7786 and price should stay well above wave i top at 0.7712.

On the 4-hour chart, the move from 0.8066 is the wave 5 with i: 0.8860, ii: 0.8315, wave iii is an extended move ended at 1.0183, iv: 0.9706 and wave v has ended at 1.1081 (also the top of entire wave 5). The subsequent selloff is the major correction which is unfolding as ABC-X-ABC and 2nd A leg has ended at 0.8848, followed by a-b-c wave B which ended at 0.9758, hence, 2nd C wave is now in progress and indicated downside target at 0.7000 and 0.6950 had been met, so further fall to 0.6710-20 cannot be ruled out.

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