Keeping an eye on AUD/USD, GBP/USD, and USD/SGD yesterday payed off, the first two pairs offering a 30 to 50 pips move each which is not exactly bad taking into consideration that the market is currently consolidating, and more important moves are expected to after the Fed's Rate decision on Wednesday.
The Reserve Bank of Australia just offered us a bearish signal at about 3:00 AM GMT., when the Australian Dollar practically exploded. The intervention of RBA becomes even more obvious if we take into consideration that this immense appreciation of AUD happened during the Asian session. Needles to say that at this moment AUD is overbought, AUD/USD is testing the resistance pivot points and it seems it doesn't have the strength to break this barrier by itself.
On short term charts (1hr and 15 min) the AUD is giving clear signs of reversal, so a good thing would be to keep an eye on this pair until the down trend is fully confirmed and then go short around 1.0000. A stop loss between 1.0150 and 1.0200 should be safe.
(the image is from a 3hrs AUD/USD chart)
Tuesday, November 2, 2010