AUDUSD: Bearish below 0.6882
Yesterday’s signals were not triggered, as there was insufficiently bearish price action when the resistance level at 0.6882 was first reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken 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 0.6882 or 0.6909.
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
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6817 or 0.6803.
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 we had probably seen the most of this bearish movement already, but it would be wise to look only for short trades. I was ready to take a bearish bias if we had gotten a pullback to 0.6909 and a bearish reversal there, or even at 0.6882.
This was a good call, although it did not work out precisely enough to produce a trade entry. However, the level at 0.6882 has continued to hold and so the picture remains technically bearish. The price action has also invalidated the former support level, which was nearby yesterday, although we did see some support there.
I am prepared to take a bearish bias if we get another bearish reversal at either 0.6882 again or at 0.6909.
Concerning the USD, there will be a release of the ADP Non-Farm Employment Change at 1:15pm London time. Regarding the AUD, there will be a release of Trade Balance data at 12:30am.