AUDUSD analysis: bulls fail at 0.6937
Last Thursday’s signals were not triggered, as there was no bearish price action at 0.6891 that day.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm Tokyo time Tuesday.
Long Trade
Long entry following some bullish price action on the H1 time frame immediately upon the next touch of 0.6912, 0.6902, or 0.6882.
Put 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.
Short Trades
Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.6937 or 0.6963.
Put 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.
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 as the price looked heavy and very likely to test last week’s low, I would therefore take a bearish bias today if the price could trade below last week’s low for a couple of hours consecutively. I noted that the NZD was even weaker than the AUD, so NZD/USD short may be a better alternative trade.
This was a poor call, as just after I wrote this the AUD took off against the USD, rising all the way to the resistance level at 0.6937 where it failed a few hours ago at the resistance. It looks as if the price put in what could be a long-term bottom at about 0.6865.
Despite this bullish burst, there should be enough residual bearishness for the resistance at 0.6937 to hold, at least for a while. Therefore, I think either a long from a bounce at 0.6912 or a short from a bearish bounce at 0.6973 again would both be acceptable trade opportunities. However, I don’t think any profit would run very far.
There is nothing of high importance due today concerning either the AUD or the USD. It is a public holiday today in the U.S.A.