AUD/USD: Sentiment mixed but risk-off strengthening
Yesterday’s signals may have produced a profitable short trade from the bearish reversal from the resistance level at 0.6970.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be entered between 8 am New York time Wednesday and 5 pm Tokyo time Thursday.
Long Trade Ideas
- Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6885.
- Put the stop loss 1 pip below the lowest recent price.
- Move 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 run.
Short Trade Ideas
- Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6951 or 0.6972.
- Put the stop loss 1 pip above the highest recent price.
- Move 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 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 I was willing to take a short trade if we had gotten a firm bearish reversal following a retracement to the resistance level at 0.6951.
Unfortunately, the significant bearish turn where it would have been a good idea to make a short trade entry occurred just barely above the higher resistance level at 0.6970, which I have adjusted upwards slightly to 0.6972.
The technical picture has become more bearish due to the short-term symmetrical bearish price channel which seems to be effectively pushing the price down.
Market sentiment is a little mixed in the absence of any real fresh data releases but is slowly deteriorating towards risk-off, which will certainly help bears here.
I would again be happy to take a short trade from a bearish reversal at 0.6951 which is confluent with a half-number and the upper trend line of the short-term bearish price channel.
There is nothing of high importance scheduled today regarding either the AUD or the USD.