A good short opportunity in the works on the AUD/USD pair

Forexmentor.com Forex Trading Price Action

It appears that the Aussie (AUD/USD pair) is trying to top out on the daily chart, what with the Big Dogs extremely short vis-à-vis COT (a.k.a. Commitments of Traders) data. According to Christoph Lahrs, the telltale signs of a topping out process are three legs up, accompanied by three legs down on Stochastics. Two legs are already in place, as of today, and STO (a.k.a. Stochastics) is exhibiting negative divergence to price. A good short opportunity in the works folks. In the meantime, day traders had a field day today. The 50 and 100 EMAs performed a ‘Golden Cross’ yesterday afternoon on the 15 minute chart, with MACD trending above the waterline. Accordingly, price came into today’s session above the central pivot point, retested it just before the London open, and then headed north to find its expected high for the day (M4 on an M2/M4 day) – this after it broke a resistance (a.k.a. supply or distribution) Tom DeMark trendline immediately after the London open. This break was confirmed by MACD punching up through its trigger line. Beware though that, once price breached the M4 level, it was in dangerous territory – overbought in the area above the central pivot point, which carries a ‘sell status.’ For more on what all this techno babble is all about, you should check out the members’ area at www.forexmentor.com.

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