This is twofer post ....
1. Where are the orders in the AUD/USD now
2. And the educational component of point 1, which is why are the orders there now?
OK ... point 1
With the AUD having been marked down / sold off on the headline miss for the capex data, offers (i.e sellers) have emerged already ahead of 0.7250
The selling is from those wanting to establish new shorts ... AND from those wanting to get out of AUD they've bought (there have been buyers around 0.7250 overnight)
Check out the price behavior overnight:
You may have heard the expression 'support becomes resistance' ... partially this is so because those buying around (for example) 0.7250 will be perturbed by this fresh information (bad capex result) and will want to get out (near flat if they can) ... and partially 'cause some traders have heard the expression 'support becomes resistance' and will be looking for sellers (for example in this case) to lean against around 0.7250 now.
I hope that makes sense?
While I'm at it ... part of my argument is that there will be selling around 0.7250 because there will be selling around 0.7250. No, that's not a typo.
If you're a technical analyst type, you might draw a line in around 0.7250 and say its resistance now. If you're a critic of technical analysis you might say that its just a 'self-fulfilling prophesy'. I've never understood that criticism myself. If it is, surely that's a good thing and makes making money easy? A feature, not a bug. Bring it.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
