Last Thursday’s signals were not triggered, as the bearish rejection of the resistance level I had identified at 0.7247 did not take place until after 5pm Tokyo time, which was unfortunate as it could have been a very good short trade entry.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be taken between 8am New York time and 5pm Tokyo time, over the next 24-hour period.
Long Trades
Go long following some bullish price action on the H1 time frame immediately upon the next touch of 0.7165 or 0.7123.
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.
Short Trades
Go short following some bearish price action on the H1 time frame immediately upon the next touch of 0.7247 or 0.7275.
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.
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 last Thursday that I did not see any reason to change my approach, which was to wait for a reversal at 0.7250 for a short trade entry, but I had no faith such a short would run very far. Conversely, I thought that a sustained break above 0.7275 would be a bullish sign. This was a good call as that area was the pivotal point of the day and the high of the week.
The price fell quite sharply from the resistance, even trading slightly below the nearest key support level at 0.7165 for a few hours before recovering this week as the U.S. Dollar has weakened. Therefore, all the key levels remain intact, and movement is moderate with quite low relative volatility. This leaves me with the conclusion that this currency pair is not something worth getting excited about today and I take no directional bias.
There is nothing important due today concerning either the AUD or the USD.