1600 pip uncorrected rally for the past 5 months
Firstly, we should have a look at all the AUD-pairs. We want to buy when the price is low, sell when the price is high and don't trade when the chances are 50/50 (near the middle line).
ML: EURAUD
short: AUDCAD
long: AUDCHF, AUDJPY, AUDNZD, AUDUSD, GBPAUD
So, we should keep in mind that our general objective is to go long on AUD due to its current weakness.
Next we should focus on the big picture of AUDCAD and go a little bit deeper. For this reason let's have a look at the weekly:
We see a large sequence starting at a level almost equal to the ATH. A is extremely corrective, while B is impulsive. What we would expect is an impulsive consequence following this stable fundament (impulsive C). The C started out as we wanted, in an impulsive manner, but before it could reach the target levels at the bottom - near the ATL - the sequence got stopped out by the correction levels of the opposite upward movement. As a consequence it bounced back up and is currently in the BC correction level, which is optimal.
If we wanted to make a transaction here, we would short it. Since we're intraday traders, let's dig deeper.
The 2h timeframe...
...shows us a rally since mid March 2020 without a significant correction. Let's keep that in mind. We also see a sequence emerging from the starting point of the rally. A shows us its impulsivity, as does B. The consequence is an impulsive C with a tendency of correctiveness due to its duration. It slowly and steadily climbed up until it reached the target levels. We should bear in mind that just because a sequence finishes, it doesn't mean it cannot go farther.
But as of right now we have 3 confirmations to go short:
1) the BC correction level in the weekly timeframe
2) reaching the target levels
3) an uncorrected rally for the past 5 months which is 1600 pips (!) big
Since we're intraday traders, let's have a look at the 30m timeframe:
Sequences only emerge from turning points and then they have to slowly build up, build a fundament to be able to reach the target with an explosive and impulsive C. As shown we currently have merely A and we wait for more structure. A is almost 200 pips, so there is a large tendency to correct it, which would create our B.
It would be very beneficial to us, if it started correcting in the blue turning area, fighting with the bears for quite a while, leaving the turning area with an impulsive sequence to reach the target levels.
This is our roadmap. But do you remember the strength of the currency? As we said in the beginning, the AUD is currently very weak and almost all pairs are looking for longs, so we should not short it yet.
But if we need a hedge for AUD, we can go short on AUDCAD. The probability for succeeding in going short is even higher when traded from the whole correction level - the blue rectangle.
This was refreshing. I hope you enjoyed it. If you have any remarks or suggestions, let me hear of you.
***
This is no financial advice and should not be treated as such. It only represents my ideas by applying the system I learnt from Stefan Kassing.
ML: EURAUD
short: AUDCAD
long: AUDCHF, AUDJPY, AUDNZD, AUDUSD, GBPAUD
So, we should keep in mind that our general objective is to go long on AUD due to its current weakness.
Next we should focus on the big picture of AUDCAD and go a little bit deeper. For this reason let's have a look at the weekly:
We see a large sequence starting at a level almost equal to the ATH. A is extremely corrective, while B is impulsive. What we would expect is an impulsive consequence following this stable fundament (impulsive C). The C started out as we wanted, in an impulsive manner, but before it could reach the target levels at the bottom - near the ATL - the sequence got stopped out by the correction levels of the opposite upward movement. As a consequence it bounced back up and is currently in the BC correction level, which is optimal.
If we wanted to make a transaction here, we would short it. Since we're intraday traders, let's dig deeper.
The 2h timeframe...
...shows us a rally since mid March 2020 without a significant correction. Let's keep that in mind. We also see a sequence emerging from the starting point of the rally. A shows us its impulsivity, as does B. The consequence is an impulsive C with a tendency of correctiveness due to its duration. It slowly and steadily climbed up until it reached the target levels. We should bear in mind that just because a sequence finishes, it doesn't mean it cannot go farther.
But as of right now we have 3 confirmations to go short:
1) the BC correction level in the weekly timeframe
2) reaching the target levels
3) an uncorrected rally for the past 5 months which is 1600 pips (!) big
Since we're intraday traders, let's have a look at the 30m timeframe:
Sequences only emerge from turning points and then they have to slowly build up, build a fundament to be able to reach the target with an explosive and impulsive C. As shown we currently have merely A and we wait for more structure. A is almost 200 pips, so there is a large tendency to correct it, which would create our B.
It would be very beneficial to us, if it started correcting in the blue turning area, fighting with the bears for quite a while, leaving the turning area with an impulsive sequence to reach the target levels.
This is our roadmap. But do you remember the strength of the currency? As we said in the beginning, the AUD is currently very weak and almost all pairs are looking for longs, so we should not short it yet.
But if we need a hedge for AUD, we can go short on AUDCAD. The probability for succeeding in going short is even higher when traded from the whole correction level - the blue rectangle.
This was refreshing. I hope you enjoyed it. If you have any remarks or suggestions, let me hear of you.
***
This is no financial advice and should not be treated as such. It only represents my ideas by applying the system I learnt from Stefan Kassing.
Trade active:
A bullish sequence finished after many AUD pairs rallied up. Because they spiked up without a correction I reckoned that a correction must come soon. What time is better than a finished sequence to short it? We still got a little bit of room to the upside as in AUDJPY, so my assumption is that it will still go a little bit higher before entering a correction.
Trade closed manually:
Closed at noon because I wanted to be free for weekend. After that it went right to the target levels. Lots of potential for profit. 3 pips profit for me, nice!
