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Greg Michalowski, chief currency and trading analyst for FXDD, analyzes the movers in the forex market using a consistent systematic approach utilizing tools that define trends and quantifies risk.

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Selling AUDUSD to fill the gap. Does it make sense?

Posted on September 13, 2010 at 17:10 in Forex News, Forex Trading, Videos by Greg Michalowski

AUDUSD has gapped higher over the weekend mainly on better than expected China data. Is it a good time to sell in anticipation of the gap being filled? In my book, traders need a reason to sell - not just a gap. A reason might be a move below a trendline or perhaps a move through the 100 bar MA on the 5 minute chart. Each would give the AUDUSD a bearish bias and also define risk for traders. If the price falls below the 100 bar MA and then moves back above the trader should cover. It is when the price moves below and stays below the MA, that confirms the bearish bias which attracts further selling pressure. For a full discussion, click on the following video link.

Tags: AUDUSD

One Response to “Selling AUDUSD to fill the gap. Does it make sense?”

on 17 Sep 2010 at 2:51 pm1fxgal

Greg, excellent explanation & analysis of gaps on this pair - thanks!

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