My previous signal on 7th November was not triggered, as none of the key support or resistance levels I had identified were reached that day.
Today’s AUD/USD Signals
Risk 0.75%
Trades must be entered before 5pm Tokyo time Friday.
Short Trade Ideas
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of $0.6609 or $0.6631.
- 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.
- Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6456, $0.6391, or $0.6345.
- Put stop loss 1 pip below the local swing low.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Take off 50% of the position as profit when the price reaches 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 in my previous forecast on Tuesday last week that the AUD/USD currency pair was likely consolidate above $0.6400 where it might give a long trade from the nearest support level at $0.6391.
This was a good call, as the price did consolidate above $0.6400 that day.
There has been a major change in outlook after US and UK inflation both came in lower than expected this week, showing firm declines in inflationary pressures in major economies. This has strengthened the case for rate cuts, especially in the US Dollar, and this has helped boost risk appetite, which is usually strongly represented by the Australian Dollar, and trigger weakness in the US Dollar. This has given this currency pair some bullish momentum.
The price chart below shows the price is rising firmly after retracing to almost reach the nearest support level a few hours ago.
The price is currently not far from the 3-month high price above $0.6500 and there are no technically valid resistance levels in the way of such a long-term bullish breakout.
I think the price is likely to rise higher today. If instead it first makes another bearish retracement and bounces at the support level at $0.6456, especially if it also rejects the half number at $0.6450 at the same time, I will be happy to enter a long trade there.
Concerning the USD, there will be a release of Unemployment Claims data at 1:30pm London time. There is nothing of high importance scheduled today regarding the AUD.
Ready to trade our daily Forex signals? Check out this list of the best Forex platforms in Australia.