AUDUSD could be on the brink of a new third wave lower, according to Tony Sycamore, Senior Dealer Institutional Foreign Exchange at Commonwealth Bank of Australia.
He says this morning’s trading below 0.7750 and its inability to move beyond the 0.7820/50 area, “leaves the distinct technical impression the recent rally to the 0.7849 high was a corrective rally, to be followed by new lows.
As such, Sycamore suggests a short trade idea in AUDUSD:
Leave an order to sell a Tier 2 weighting at 0.7735 with a buy stop placed at 0.7855. Given the possibility of a new third wave lower (as per count on the chart), he suggests leaving the target open for now. Should AUDUSD trade at 0.7650 before 0.7735, cancel the order.