AUDUSD: Bullish reversal from 0.6900?
Yesterday’s signals were not triggered, as none of the key levels were reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken before 5pm Tokyo time Thursday.
Long Trade Ideas
Long entry following some bullish price action on the H1 time frame immediately upon the next touch of 0.6903 or 0.6857.
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 Trade Ideas
Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.6940, 0.6955, or 0.6975.
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.
AUD/USD Analysis
I wrote yesterday that the picture had become more bearish now, but the price was still well within its long-term range, and it would not be surprising if the price found support even before 0.6903 was reached. Over the very short-term, at the time of writing, it looked as if the price would move to still lower prices.
This was a good call as it reflects exactly what happened over the past 24 hours.
The price has made a strong bullish move over the past couple of hours from about 0.6910, and although the move is not very big, it does look significant. I see this as an indication that the bearish move of the past few days has probably finished, at least for a while. Over the medium-term, this may be a good spot to enter a very patient long trade, but I see bearish bounces at nearby resistance levels as also attractive entry points, especially at 0.6955 which is the standout resistance level here.
I would take a bearish bias if we get a firm bearish rejection at 0.6955 after the FOMC minutes are released later.
There is nothing of high importance due today regarding the AUD. Concerning the USD, the Chair of the Federal Reserve will be testifying before the House of Congress at 3pm London time, and there will be a release of FOMC Meeting Minutes at 7pm.