I closed my short on the sharp break above 84.87 this morning. My stop was still intact, but I decided not to wait and take a smaller loss now. Trade closed at 84.97 for a 40 points loss (46 point gross P/L). The market has built a solid base before the breakout and I expect further upside from here.

Hourly Chart:

The 3-Drives pattern appears to be complete, and a double hourly close below the EMA10 pulls me into the market again. Nice symmetry on the 3-Drives pattern, and good Fibonacci confirmation. I sold at 84.57 with a stop at 85.25, above the 1.618 extension of the 2nd leg of the pattern, and also above the 0.61.8% Fibonacci retracement level at 84.95. Target is just above the 21.4% Fibonacci retracement of the 3 legs at 83.88, which is also the low of leg 2.

Hourly Chart:

My short trade was stopped out earlier today at 84.84 for a 63 point loss. Price keeps pushing to the upside and may form a 3-Drives pattern on the hourly chart. Ideally we’ll see a push into the 85 zone followed by a close below the hourly EMA10. A move above 85.35 will likely negate the break below 84.80, and leave a false breakout behind.

I went short on the formation of a Gartley Sell Pattern against yesterday’s break of and close below 84.80. Two hourly closes below the hourly EMA10 triggered my entry, and I sold at 84.30. Stop at 84.84 is 17 points above the second leg of the Gartley pattern, and just above the daily low at 11/27/09. Target is the 1.27 extension of the pattern at 83.29.

The second leg of the pattern ends at the 1.27 extension of the first, so there’s good Fibonacci confirmation. But I was hoping to see a move to the 1.618 extension which falls into a stronger resistance zone near 85. There’s some risk of a move up there still, but I don’t want to have a wider stop to allow for that, and prefer to re-enter if price dynamics call for that. Don’t want to get caught short if this turns into a false breakout.

Hourly Chart:

I closed my short position for a 52 point profit at 0.8876, just ahead of strong support at 0.8860..70. Downward momentum is weak and we’re near oversold. A bounce from here is more likely than a continuation of the trend in my opinion, and I prefer to have no position overnight and a small profit.

Two consecutive closes below the hourly EMA10 were my trigger to go short. I just sold at 0.8928 with a stop at 0.9000 and a target of 0.8792 (the 1.27 extension of the Gartley pattern).

A Gartley sell pattern on the hourly chart is almost complete but not confirmed yet. I’m waiting for a close below the hourly EMA10 line before setting an entry order. Price is now between the 1.27 and 1.618 extension of the first corrective leg that formed Friday, and the second leg that has formed since the drop at the Australian opening looks fairly complete now. We may still see a move to the 1.618 extension level near 0.8988, where there’s also a confluence of other Fibonacci levels (the 38.2% level of the 0.9078-0.8840 range, and the 61.8% level of the 0.9221-0.8840 range). If price continues towards that level, it may very well find strong resistance there.

The dailies are still clearly bearish, and the above mentioned 0.8985 level is also the level of the daily EMA10 and EMA20, as well as the rising trendline that price broke and closed below on Friday and is now retesting.

All in all, there’s a very good short opportunity coming up, and I’m looking to re-enter short (I had closed my previous short position at 0.8925).

Hourly Chart:

Daily Chart:

I just exited my short for a 75 point profit at 0.8925. Falling very fast right into hourly and trend line support, likely to see a strong pullback that may lead to further upside. Also, the entire drop from 0.9078 to 0.8915 looks a bit too corrective.

The AUDUSD has formed a nice Gartley Sell Pattern on the hourly chart, with very good Fibonacci confirmation. I missed an entry opportunity on the drop below the hourly EMA10, then near 0.9030, but used the corrective upswing to 0.9017 this morning to go short at 0.9000. Price quickly collapsed after the hourly close below the EMA10, as trading algorithms almost instantly started a sell-off frenzy only a second after the close.

My stop is set at 0.9096, but will tighten it to entry as soon as the break below 0.8943 (61.8% retracement level and hourly support) is being sustained. My target is the 1.27 extension of the ABCD part of the pattern, which comes in at exactly 0.88.

Hourly Chart:

The drop to 1.2760 stopped out my long position this morning. The lack of the rebound to extend much beyond 1.29 and the drop below the 61.8% Fibo level and MA100 now increases the risk for further downside. Daily EMA10 is now pointing down, prohibiting me from going long. Standing aside for now and will look for a short entry opportunity on a rebound towards 1.31.