AUD/USD Forex Signal | DailyForex

AUDUSD analysis: Downtrend in doubt after strong bullish move

Yesterday’s signals were not triggered as there was no bearish price action at any of the resistance levels which were reached over the past day.

Today’s AUD/USD Signals

Risk 0.75%.

Trades may only be taken between 8am New York time Thursday and 5pm Tokyo time Friday.

Long Trades

  • Go long following some bullish price action on the H1 time frame immediately upon the next touch of 0.6903 or 0.6875.
  • Place 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.

Short Trades

  • Go short following some bearish price action on the H1 time frame immediately upon the next touch of 0.6940.
  • Place 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

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.

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AUD/USD Analysis

I wrote yesterday that there was new higher support at 0.6862 and the price does not seem to be in a hurry to move any lower, so I thought that it would be wise to be very cautious here before making trades in either direction. I was ready to take a bearish bias if we got a solid bearish break below 0.6862, but only after the FOMC release due later.

This was a good enough call to stay out of trouble. There has been a strong move against the U.S. Dollar almost everywhere, even by a relatively weak currency such as the Australian Dollar. However, I think a look at a long-term price chart shows that it is too early to write off the long-term bearish trend in this currency pair. Much will depend upon how the price reacts now once the situation post-FOMC becomes more settled, perhaps following a test of the key resistance level at 0.6940.

There is still short-term bullish momentum in the price, so it seems probable that there will be still higher prices in this currency pair today.

AUD/USD Forex Signal | DailyForex

There is nothing of high importance due today regarding either the AUD or the USD.

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