AUDUSD: Bullish but running into strong resistance
Last Thursday’s signals were not triggered, as none of the key levels were ever reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be taken between 8am New York time Monday 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 0.6927, 0.6940, or 0.6955.
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 0.6884, 0.6855, or 0.6845.
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 seeing a bearish retracement now, but the bulls still had the upper hand. However, I thought that there were unlikely to be any clear-cut opportunities over the day. This was a good call as the price mostly fell or moved sideways over that day.
The bulls have persisted, and the AUD is basically one of the strongest currencies right now. However, the area of resistance which begins at 0.6927 is very strong as a long-term pivotal area, and there are several horizontal levels of resistance above that, so it may be very hard for bulls to push the price much higher so a bearish double top formation off 0.6927 becomes more likely.
The question is whether there is anything coming which could push the price hard in either direction. The answer is yes, in the form of the RBA Rate Statement which will be released during the Asian session. It may be wise to avoid trading this currency pair until that is released.
There is nothing of high importance scheduled today concerning the USD. Regarding the AUD, there will be a release of the RBA’s Rate Statement at 3:30am.