AUD/USD: Key support level at 0.5979
Last Thursday’s signals were not triggered, as there was insufficiently bullish price action at the support level of 0.6023 to justify a long trade entry.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken between 8am New York time Monday and 5pm Tokyo time Tuesday.
Short Trade Idea
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6268.
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 Idea
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.5979.
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 last Thursday that I would look for a short trade in this currency pair today after it had made two consecutive hourly closes below the key round number at 0.6000, as I was confident that once below that level it would continue to fall due to the long-term bearish trend.
This was a good enough call to keep out of trouble as the price never closed below 0.6000 for the rest of that day.
The technical picture has changed, as we see that former level invalidated and new clear support at 0.5979, plus a new bearish price channel which is drawn within the below price chart. This gives a more confused picture, so the best I can say now is that the price will look more bullish if it can get established above the upper trend line at about 0.6100 or more bearish below the support level at 0.5979. I would avoid trading this currency pair as long as the price is between these two levels.
There is nothing of high importance scheduled for today concerning the USD. Regarding the AUD, there will be a release of the RBA’s Cash Rate and Rate Statement at 5:30am London time.