AUD/USD: Pivotal point at 0.6706
Yesterday’s signals were not triggered, as there was no bearish price action at 0.6706.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be taken from 8am New York time Tuesday to 5pm Tokyo time Wednesday.
Short Trade Ideas
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6725 or 0.6781.
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
Long entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6706.
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 much would now depend upon whether the obvious pivotal point at 0.6706 continued to hold. This was a great call as the level very obviously failed to hold, and has now flipped to become new higher support, giving a less bearish picture. The increased bullishness is supported by improving global risk sentiment.
I think the level at 0.6706 will continue to be pivotal, and if the level only breaks after New York opens and we see two consecutive hourly closes then below 0.6700, we would be likely to see a further fall. This could be interesting to trade, as there are very long-term multi-year new low prices which could be made easily, with the price possibly ready to cover a lot of distance.
Alternatively, if the price can get established above 0.6725 or even better 0.6750, it would be likely to rise higher.
Concerning the USD, the Chair of the Federal Reserve will be testifying before Congress at 3pm London time. There is nothing of high importance due today regarding the AUD.