Forex Price Action Setups – Pin Bar & Dueling Swords Pattern Play Out – June 11th

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As we wrote about in our forex market commentary yesterday, the AUDUSD formed both a pin bar and dueling swords pattern, initially rejecting off of parity.  The markets gapped higher on the open from the Spanish Bank bailout of €100B, which has already seen its luster come off.  Is it now to the point that €100B injection lasts only a few hours?  If so, things are really bad.

Regardless, the dueling swords pattern played out on both sides, completing the initial pattern in gapping higher, then forming a pin bar setup at the parity level again.  It also formed an intraday pin bar reversal setup which many of our price action traders got in on as it was discussed during market open so hopefully you profited on that.

Daily Chart
pin bar strategy dueling swords pattern june 11th

1hr Intraday Chart
pin bar trading price action june 11th

The double rejection off parity doesn’t bode well for the bulls who came in off .9600 and were trying to reverse the trend.  Intraday price action on the hourly looks slightly over-extended, selling off for 9 consecutive hours and 14 of the last 16.  We suspect price action may pause at .9830 as there is some solid support and prior accumulation there.  But should this fail to produce a solid reversal, then .9800 is up next and .9763 so bears have some downside play.  Intraday bulls can take plays off the .9830 and .9800 levels for moves up to .9890 and .9930.

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Global Market Commentary:
The Spanish bank bailout took center stage and everyone’s attention as investors globally are worried the banks will need more capital to be shored up while skeptical details about the actual bailout and who’s holding the hot potato, did not calm investors.

Spanish yields soared breaking through 600bp as people realizing Spain is just like Greece – borrowing money but not doing anything about growth.  With the highly anticipated upcoming Greek tragedy elections on June 17th,  has hammered markets and expect these worries to continue.

Meanwhile, the Dow snapped its short lived winning streak and sold off 142pts or 1.14%, the Euro sold off 190pips from the weekend gap/surge while Gold gained $5.40 as risk off meant gold on.

Upcoming Economic Announcements:

AUD NAB Business Conditions 01.30GMT 21.30EST
GBP Industrial Production (YoY) 08.30GMT 04.30EST
GBP NIESR Gross Domestic Product Estimate 14.00GMT 10.00EST
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