Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken from 8am New York time until 5pm Tokyo time, over the next 24-hour period only.
Long Trade
Go long following some bullish price action on the H1 time frame immediately upon the next touch of 0.7343.
Put the stop loss 1 pip below the local swing low.
Move 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.
Short Trades
Go short following some bearish price action on the H1 time frame immediately upon the next touch of 0.7420.
Put the stop loss 1 pip above the local swing high.
Move 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 wrote yesterday that I was weakly bearish below 0.7420 and above 0.7374, and that if the price reached 0.7374, its reaction there would probably be significant. This was a fairly good call as the price has continued to decline, eventually breaking below 0.7374, which suggests further bearishness. There is a long-term bearish trend which gives more validity to a bearish approach. However, looking at the recent candlesticks, I do not have much confidence that the price is ready to break or even touch the recent swing low yet, so it’s a bit of a mixed picture here.
There is nothing important due today concerning the AUD. Regarding the USD, there will be a release of Core Durable Goods Orders data at 1:30pm London time, followed by Crude Oil Inventories data at 3:30pm.