AUD/USD: Long-term low near 0.6677?
Yesterday’s signals were not triggered as there was insufficiently bearish price action at 0.6740.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken from 8am New York time Wednesday to 5pm Tokyo time Thursday.
Short Trade Ideas
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6781, 0.6799, or 0.6817.
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 0.6725 or 0.6706.
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 longer support levels can hold, the greater the chances will be that we have just seen a major bullish reversal. I was ready to take a bullish bias if the price could get above 0.6750 later today.
I was right to be looking to the bullish side as the support levels all held, although the price only got above 0.6750 in the hours after Asia closed.
I think the chances are increasing that we have seen a major long-term low, so long-term long trades could still be interesting here. The AUD has been boosted by the increasingly risk-on sentiment in the markets as hope takes hold that China has succeeded in controlling the coronavirus outbreak.
We have major data for both currencies later, so direction is hard to predict. I think we may now see some sideways action for a while but buys from bounces at any support levels identified above could be interesting trades.
Concerning the USD, there will be a release of the ADP Non-Farm Employment Change at 1:15pm London time and ISM Non-Manufacturing PMI data at 3pm. Regarding the AUD, there will be releases of Retail Sales and Trade Balance data at 12:30am.