AUD/USD weakness continues
Early last week in our commentaries we were discussing the potential for price to continue to fall in the AUD/USD following the large bearish reversal that took place on May 3rd after the RBA cut rates. We remain bearish (downward) biased this week and our view is to look for selling opportunities whilst price is below 0.7490 key resistance.
We will be looking for an opportunity to sell this pair at that resistance or nearby should price temporarily strengthen early this week. We see the potential for a re-test of 0.7380 or perhaps even lower if bears remain in control.
EUR/USD bears take control at least for the time being
The EUR/USD appears to have false broke above 1.1450 last week with two daily bars from May 3rd and 6th showing substantial upper tails which is a bearish (weak) sign. That said, any trade on the short (sell) side would have limited downside to 1.1220-40 area. However, a short-term rally (upward move) into 1.1420-50 area in early trading this week might be a selling opportunity for more aggressive traders. A move and close back above 1.1530 would invalidate any bearish view.
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Gold strength continues
Our recent views on the gold market have not changed; we still see the support area near 1260.00 – 1250.00 as a firm zone to look to be a buyer of gold from, in line with the overall uptrend in this market. If prices fall down to near that support zone and form a 1 hour, 4 hour or daily chart price action buy signal, we would look to initiate a long / buy position this week.
S&P500 reverses at important support level
We have been looking to buy the S&P500 on a pullback to support in recent weeks, as the overall trend remains up. The importance of the 2030.00 level is something we have discussed recently in our commentaries and we can see that last week price fell down to that level, tested it and bounced higher into Friday’s close. We will keep a close eye on that support level this week and we may well see price test it one more time before (if) an upside recovery happens. Traders can continue to look for buying opportunities near 2030.00 but a move and close under 2000.00 would work to invalidate our current bullish bias.
This article was written by Nial Fuller. Nial is a highly regarded professional trader and author. He is the founder of Learn To Trade The Market, the worlds foremost trading education resource. To learn more, visit www.LearnToTradeTheMarket.com