If you follow the blog, you’d remember we had been watching this AUD/JPY higher time frame resistance zone that gave us multiple chance to get short on pullbacks. A zone that if you click on the link to that previous blog, definitely gave us plenty of opportunity to build a short position out of.
Here is the zone once again. It doesn’t really get much clearer that this:
You can see that we’re still underneath the daily resistance zone and that price had consolidated thanks to Aussie fundamentals driven strength, before the technical sellers took over once again and momentum pushed price down to a new swing low.
If price is below the higher time frame resistance zone, then it’s shorts that are in play.
Therefore, it’s from here that we can look for a pullback back into short term support turned resistance to manage our risk around. This marked level looks like today’s in-play level that we want to see.
The economic calendar looks light on AUD sensitive news to start the week, so lets see how far the technical sellers can push price down. Looking back up at that daily chart, there sure is a lot of white space for price to drop down into from here.