Trade Idea: AUD/USD - Sell at 0.7880

AUD/USD - 0.7721

Most recent candlesticks pattern : Hammer
Trend : Down

Tenkan-Sen level : 0.7808
Kijun-Sen level : 0.7882
Ichimoku cloud top : 0.8014
Ichimoku cloud bottom : 0.7973

Original strategy : Exit long entered at 0.7730 with 65 points profit

New trading strategy : Sell at 0.7880, Target: 0.7750, Stop: 0.7930

Although the Australian dollar finally rose to 0.7864, as this move is still viewed as retracement of the intermediate fall from 0.8039, upside should be limited to the flat ground Kijun-Sen and price should stay well below 0.7918 (61.8% Fibonacci retracement of 0.8039 to 0.7723) and bring another decline probably tomorrow. A break of 0.7723 support would signal the last leg of the decline from 0.8156 is under way for weakness to 0.7694/96 (38.2% Fibonacci retracement of 0.6771-0.8265 and 1.236 times projection of 0.8156 to 0.7879 measuring from 0.8039).

In view of the above analysis, we prefer to sell aussie on next corrective rise but one should book profit on such a decline as support at 0.7723 (with the hammer candlestick on 4-hour chart) should hold on first attempt.

If price rises above 0.7918 calculated resistance, this would indicate entire fall from 0.8156 has possibly ended at 0.7723 and stronger rebound to the Ichimoku cloud bottom (now at 0.7973) would follow but only break of 0.8039 resistance would confirm this.