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AUDUSD – Daily Pin Bar Fails As Predicted, Crude Oil Inside Bar Breakout | Jun 12
AUDUSD – Daily Pin Bar Fails As Predicted
Yesterday in our daily market commentary, we discussed the daily pin bar at key resistance, but noted we felt the momentum was too strong to be selling said pin bar. This analysis turned out to be correct as the pair dipped only a tiny bit lower, then skyrocketed higher, forming a new daily high.
This goes to show how important it is to read price action context in real time, which was clearly communicating the current leg was still showing heavy momentum. You must learn to read the price action context first, not just salivate at every pin bar.
The pair has now reached the resistance zone we suspected it would, between 9425 and 9460, printing a daily high of 9436. Although I like the zone we are in, the impulsive leg leading up to this move was quite strong.
Our Trade Idea: Overall, the short and medium term outlook is bullish, especially if we get a daily close above 9460, but there may be an end of the trading week play here.
I will wait for a move up towards the 9445/9460 highs before even entertaining the idea of a short. If the move up there is weak/corrective in nature, look to take a short, with tight stops above the yearly highs. Make sure to use 1/2 your normal risk, because this is a counter-trend trade, and by default a lower probability trade.
The only reason I’m even considering this, is because tomorrow is Friday. With the bulls in control all week, I suspect they may want to take profit ahead of the weekend considering the geo-political risk out there, thus causing a fade opportunity before breaking the new highs.
Crude Oil – Rockets Higher After Inside Bar on Geo-Political Risk
Coming alive today and busting out of the gate, WTI Crude Oil literally was bought up from the open, and held the foot to the floor till the daily close, as geo-political risk from the situation in Iraq caused the commodity to sky today. Although this commodity is always and heavily tied to geo-political tensions, particularly in the Middle-Eastern region (and such tension could change on a dime), we favor the bullish view while it remains above 105.
It should be noted how it formed a daily inside bar just yesterday before today’s launch. Usually the price action is building in a particularly direction before the event risk, but confirms said direction after the event causes changes in the risk premium.
Our Trade Idea: Look to be buyers on pullbacks into the 105/105.25 area. Upside targets are 106.83 and 108.15. Maintain a bullish bias until we get a daily close below 105.
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