AUDUSD analysis: Bulls still pushing price up, but 0.7000 area may resist
Yesterday’s signals were not triggered, as none of the key levels were reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be taken from 8am New York time Thursday until 5pm Tokyo time Friday.
Long Trade
Go long following some bullish price action on the H1 time frame immediately upon the next touch of 0.6940.
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.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
Short Trades
Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.7047.
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.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
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 would like to take a cautiously bullish bias on this currency pair, but the big round number at 0.7000 may be too much to break right now. If the price could close above 0.7000 for three hours consecutively later, I would take a bullish bias and expect a continuation of the bullish price movement up to the next resistance level at 0.7047.
This was good enough to stay out of trouble. The price has continued to inch up but still has not reached the 0.7000 which will probably be the momentum of truth. We are also close to long-term highs, so a major reversal on rapidly increasing volatility would be likely to signal a substantial downwards movement. Meanwhile, the commodity currencies are generally strong, although the AUD is the weakest of the AUD, NZD and CAD.
Again, I would take a cautious bullish bias today up to 0.7047 if the price can close above 0.7000 for three hours consecutively later.
There is nothing of high importance due today regarding the AUD. Concerning the USD, there will be a release of Final GDP data at 1:30pm London time.