AUD/USD: More likely that the price put in a medium-term bottom
Yesterday’s signals were not triggered, as the bearish price action at 0.6623 was too slow to give a short trade entry signal.
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 0.6623, 0.6635, 0.6662, or 0.6683.
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 Ideas
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6583 or 0.6562.
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 if the price could get established above the next resistance level at 0.6585, it would be a bullish sign. This was a good call.
It looks increasingly likely that the lows we saw a few days ago are going to hold for at least the medium-term, and maybe the long term as well. Finally, we are seeing what look like solid new support levels being printed and respected by the price action here.
The resistant area below 0.6635 may hold, as it looks quite strong, so if the price can get established above that level, it would be a bullish sign.
We are seeing a weaker USD and some increase in risk appetite, both of which seem to be pushing the price up, and the line of least resistance looks to be upwards right now. However, there are important data releases for both currencies later, so movement may become unpredictable.
Today I would only look for a long trade from a bullish bounce at any support level.
Concerning the USD, there will be a release of the ADP Non-Farm Employment Change at 1:15pm London time followed by ISM Non-Manufacturing PMI data at 3pm. Regarding the AUD, there will be a release of GDP data at 12:30am.