AUDUSD: Ranging with a bullish tilt
Last Thursday’s signals were not triggered, as there was no suitably bullish price action when the support level identified at 0.6885 was reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm Tokyo time Tuesday.
Short Trade Ideas
⦁ Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6885, 0.6927, or 0.6940.
⦁ 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.
⦁ 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.
Long Trade Ideas
⦁ Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6845, 0.6834, or 0.6809.
⦁ 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.
⦁ 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 we were still seeing wide swings within a range from 0.6927 to 0.6855, so I would be looking to fade reversals at either of these extreme levels. This was an OK call although the range broke down a little eventually at the bottom end.
This pair technically is now within a range stretching from 0.6809 to 0.6927 and reversal trades at either extreme level are likely to be fruitful, so I would be looking to trade this range.
It may be that the bullish turn in direction which we have had in recent hours will produce some pips today on the long side without the extremes of this range being hit, so taking long trades on short time frames above 0.6862 could be interesting to day traders, but not during the New York session due to today’s U.S. holiday. Short-term traders there must beware of the resistance level at 0.6885 which would be a logical area at which to take profit on such trades.
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.