As, I mentioned in the last part of my trade updates about Australian dollar can continue the rally, and It give me confidence after decline in unemployment in OZ area still giving boost to Australian dollar and Longs were triggered around.
The best part of this activity is that liquidation break has been faded out and price has taken the highs out and Now just consolidation and holding higher prices, which is also a good clue if it is followed by a test of trade location during the release yesterday.
If you want to get good price and capture a reversal of correctional trend(as you can see price spike off minor development area from the lows which is mentioned in blue rectangle), you should seen signs of real support. Real support creates conditions for a reversal if market goes against big buyer, as I mentioned when big buyers are holding the prices at highs and create trade locations and then we see strong selling as market goes against them in this case. (remember –to reverse the market, there should be supply/demand imbalance). Reversal occurs after paradigm shift, when it becomes clear for most short sellers that they were biased and go in the wrong direction.
In such case, we most often see imbalance in price action, when market has already create a development area and end the day on lows, then next day or two we saw strong accumulation and rejection from the prior day low, the suddenly paradigm shift and strong continuation of the trend is seen.
Australian dollar can break through any time
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Thursday, June 12, 2014
Strong signs of Paradigm Shifts
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