AUDUSD: Weakly bearish below 0.6830
Yesterday’s signals were not triggered, as there was no bearish price action at 0.6850 when it was reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken from 8am New York time Wednesday until 5pm Tokyo time Thursday.
Short Trade Ideas
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6850 or 0.6870.
Place 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.
Long Trade Ideas
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6830 or 0.6800.
Place 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.
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 break below 0.6850 was technically significant and we had a more bearish picture now. I thought that if the key support at 0.6830 broke down as well, the price would fall further quite quickly, so there could be a short trade opportunity on a bearish breakout there. This was enough to stay out of trouble but a completely incorrect forecast, with the price turning bullish near 0.6830 and rising all the way to 0.6870 before falling back by now to where it was this time yesterday!
This means that we are again looking at a possible bearish break below 0.6830. I would be wary of entering any trades in this currency pair before the FOMC release due later as the price has been acting relatively unpredictably. I have no overall directional bias here, but a firm break below 0.6830 could be interesting later.
Regarding the USD, there will be a release of Crude Oil Inventories at 3:30pm London time, followed by the FOMC Statement, Federal Funds Rate, and Projections at 7pm, followed by a press conference half an hour later. Concerning the AUD, there will be releases of Employment Change and Unemployment Rate numbers at 2:30am.