My previous signal on 15th February was not triggered, as there was no bearish price action when the resistance level at $0.6512 was first reached.
Today’s AUD/USD Signals
- Risk 0.75%
- Trades must be entered prior to 5pm Tokyo time Wednesday.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of $0.6590 or $0.6622.
- 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.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6506, $0.6500, $0.6480, or $0.6456.
- 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.
- Remove 50% of the position as profit when the price reaches 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 in my previous forecast last Thursday that the AUD/USD currency pair would look bullish above $0.6512 and even more so above $0.6540. This was an OK call as the price did continue to rise beyond $0.6512 but did not manage to clear $0.6540 so my expectation was met – weakly bullish.
The technical picture has changed little since then. The price is continuing its weak rise but has not yet cleared this area of continuous swing highs effectively acting as resistance at about $0.6540 / $0.6550.
The line of least resistance is upwards, as despite the resistance around $0.6550, if you look below the current price, you can see several and more tightly packed support levels.
I still think that if the price can get established above $0.6550 it will probably rise to $0.6590, so I see two consecutive higher hourly candlesticks closing above $0.6550 as an acceptable entry signal.
There is nothing of high importance due today regarding the USD. Concerning the AUD, there will be a release of Wage Price Index data at 2:30am London time.
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