I spent the last few hours coming up with a battle plan for the AUDUSD on Monday.
Some notes about Monday:
- No major AUDUSD news
- AUD public holiday
- Daily ATR(14) is 103 pips, but the combination of Monday + public holiday + no major news should see volatility significantly below this. I'm predicting a quiet day of between 50-75 pips.
How price will behave will depend on where it opens relative to 0.79000. 0.79000 has good potential to be a strong S/R level, due to it clustering with Friday's low and close.
If it opens above 0.79000, I expect 0.79000 to hold as support, and price to range 50-75 pips above it, with some potential to break down below 0.79000. If it rises all the way to 0.80000, I expect 0.80000 to hold as resistance. This would be a great place to go short. If it doesn't rise to 0.80000, I'd like to see how the range forms before buying or selling.
If it gaps below 0.79000 on Monday's open, I expect price to fill the gap before hitting 0.79000, which will behave as resistance. Price should range 50-75 pips, with good potential to break down. I would short at 0.79000.
(click below to enlarge)