Today’s AUD/USD Signals
Risk 0.50%.
Trades may only be taken between 8am New York time and 5pm Tokyo time, during the next 24-hour period.
Short Trades
Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.7696 or 0.7750.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trades
Long entry following some bullish price action on the H1 time frame immediately upon the next touch of 0.7629 or 0.7598.
Place the stop loss 1 pip below the local swing low.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
AUD/USD Analysis
I was wrong to write yesterday that the short-term outlook looked likely to be consolidative, although I did write that the major FOMC release due later today could push the price anywhere so was highly unpredictable. What happened is a very strong rise in the value of the AUD. It looks increasingly as if the bullish turn close to the round number at 0.7500 saw some long-term buying. On the way up, we have seen some very clean flips of resistance levels into new probable support. It looks like there is still some bullish momentum, and as there is no resistance until 0.7696, the price is most likely to continue rising for at least a few hours more, although the U.S. data due later could impact that. Alternatively, a pullback and bullish bounce at 0.7629 could be an attractive long trade.
There is nothing important due today concerning the AUD. Regarding the USD, there will be releases of Retail Sales and Unemployment Claims data at 1:30pm London time.