AUDUSD: RBA cuts rates to record low of 1.00%
Yesterday’s signals were not triggered as there was no bullish price action at 0.6976.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be entered between 8am New York time Tuesday and 5pm Tokyo time Wednesday.
Long Trades
Go long following some bullish price action on the H1 time frame immediately upon the next touch of 0.6955 or 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
Go short following some bearish price action on the H1 time frame immediately upon the next touch of 0.6991 or 0.7000.
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 the price had pulled back from the gapped-up high it opened at upon the start of this week. I preferred to enter a long trade from a bounce at 0.6975 instead of 0.6991. This was enough to keep out of trouble as the price cut through both support levels easily and strongly after selling off from the big round number at 0.7000. The big news for this pair today is the RBA’s quarter-point cut in its interest rate, but this was well expected and already priced in and after a quick spike down, the AUD has actually risen against the USD. The buying looks quite solid, but a failure to break above 0.7000 and a bearish reversal there could be an attractive place technically to enter a short trade later. The resistance level just a few pips below that at 0.6991 should also be OK for the same purpose and I would take a bearish bias later if such a scenario plays out.
There is nothing of high importance due today regarding the USD. Concerning the AUD, the Governor of the RBA will be giving a minor speech at 10:30pm London time.