AUDUSD: Back below 0.7000
Yesterday’s signals were not triggered, as there was no bullish price action at 0.6993.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken from 8am New York time Wednesday to 5pm Tokyo time Thursday.
Long Trade Ideas
Long entry following some bullish price action on the H1 time frame immediately upon the next touch of 0.6969, 0.6955, or 0.6940.
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 Trade Ideas
Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.6993, 0.7008, or 0.7035.
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 yesterday that we had a more bearish picture in this currency pair. I was looking for a bearish failure at 0.7035 to trigger a fall towards the 0.7000 area. This was a good call, the price got to within less than 1 pip from 0.7035 just before New York opened and the price subsequently fell all the way to 0.6977. Some days ago, I noted that this failure at a 50-day high near 0.7080 could trigger a major medium-term bearish reversal and this is what we have got now.
The USD is broadly strong, but it may be that the price here begins to stabilize as we have a cluster of three key support levels between 0.6969 and 0.6940. Therefore, I expect this price to consolidate at about 0.6969 over the coming day. I take no directional bias here now.
There is nothing of high importance due today regarding either the USD or the AUD.