AUDUSD: Looking bearish again
Yesterday’s signals were not triggered, as there was insufficiently bearish price action when the price rise stalled at 0.6800.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be entered between 8am New York time Wednesday and 5pm Tokyo time Thursday.
Short Trade Ideas
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6774 or 0.6800.
Put 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.
Long Trade Idea
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6747.
Put 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.
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 of this currency pair really had no direction, it was bearish over the long-term but over the medium and short terms it was acting quite unpredictably and just swinging around. The only feature which stood out is that were a bearish breakdown of 0.6747 to happen, the picture would become much more bearish – it would be a significantly bearish sign.
This was a pretty good call, the price made a bottom just a pip or so off the key support level I highlighted at 0.6747 before taking off, then being held by selling from 0.6800 which has driven the price back down.
The price now looks like it will fall back towards 0.6746 so I again see this as a key pivotal point. A bearish break below it might produce a sharp fall of at least another 40 pips or so. Alternatively, it may hold.
I have no directional bias and see the only event worth trading here as the reaction if and when 0.6746 is reached.
Regarding the AUD, there will be a release of Unemployment Rate and Employment Change data at 2:30am London time. There is nothing of high importance due concerning the USD.