Emerald2112 replies to: My Simple Yet Profitable Range Trading System

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How the a journalist chooses to say things sometimes is often indicative of more of their bias than it is of the truth.

You have seen in AUDUSD on this thread a channel facing down, and another longer term channel facing up.

There’s a news story here on FF about “AUDUSD bouncing off the lower bound of a down facing channel.” or something like that.

The problem is that the bounce occurs where the two channels cross. It’s impossible to really say if it’s bouncing off the lower bound of the down facing channel or the lower bound of the upper facing channel.

Now, from a trade perspective you play it safe, assume it’s the down facing channel, and place your stops closer (assuming you traded the bounce that started yesterday).

But we’ll have to wait and see which channel is going to hold, the upward facing channel or the downward facing channel.

From a fundamental perspective, I suspect it will actually be the downward channel. Trump just announced tarrifs on Chinese goods. That’s bad for the Chinese economy and by extension bad for the Australian economy.

Now to be fair, China is probably going to keep buying the same amount of metals and grains they had forecast before this happened because China is saying they still expect to hit their 6.9% GDP growth target. That however is unlikely to shift the perception of the issue.

Now that I just said that, AUDUSD is still up for the day however it’s a low volume day with the european bank holiday, even a lot of commercial and institutional US traders are taking the day off. We’ll have to wait until Monday to see what the markets will actually do.

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