On the last post about AUDUSD, I wrote that prices were on a trading range between two major supply and demand zones. I noted that an up reversal on H1 had just appeared, and it would be a good idea to enter if the bar’s high was broken. On the Asian session (9pm UTC) it was broken, and a long was taken here. Prices went on to correct yet again, but more demand showed up, and later another up reversal. This was the entry opportunity #2.
When prices rose up to the supply zone, this was the first warning to start being careful. I exit when there was a supply signal in this same zone. A few bars later, a down reversal appeared, and the market went crashing down.
In M15, given the recent weakness, the background is just showing just that. It would be interesting to see a break of the 0.713 support for weakness confirmation, support which was formed by a shake-out. To the upside, with a strong background, strong VSA signals or up Reversals could be traded above the support.
Australian Dollar went through a 90 pips fall in prices on the US session today, partly because of RBA recently communicating the reasons behind maintaining a low cash rate, with no prospects of raising it soon, and also because of the recent movements in gold, which influences Australia’s major gold exporter economy. Looking at prices and volumes, we can see the same picture – a top in very high volume and several Supply signals, without the volumes slowing down on the way down, and with a weak background.
There are 2 important zones to note in this chart – first, the distribution top, and second, a recent low which showed demand on really high volume. These were the last major professional sell and buy points, respectively, and so they should be the trigger zones to trade, either on a bounce or a break-out – the market will tell. If I see more demand signals near this area I expect the prices to rise yet again, as the professional money is clearly showing it’s buying this bottom, and not letting prices go below their last major buy point.
On H1, what jumps immediately to the eye is the major shake-out, which VSA marked as Major Demand; that major demand is what’s dominating this market. Looking at Reversals, we can see that on the highest sensitivity they have been showing all the tops and bottoms, and just 1 hour ago an up reversal was seen. The break of this bar’s top in the next hours would be a good buy point, and looking at M15, that would also be the break of the recent low volume up bars. The areas on M15 should be then watched, and special attention given to other reversals or VSA signals for exits.