AUD/USD: New 11-year low price reached again yesterday
Yesterday’s signals were not triggered, as none of the key levels were reached.
Today’s AUD/USD Signals
Risk 0.75%.
Trades may only be taken between 8am New York time Thursday and 5pm Tokyo time Friday.
Short Trade Ideas
Shor entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6585, 0.6607, or 0.6623.
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.
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 I simply took a bearish bias on this currency pair, due the Australian Dollar’s unusually weak position due to its exposure to China and risk-off fear over the potential coronavirus pandemic, which was causing the price to reach new 11-year lows.
This was a good call as the price continued to fall over the day to make a new low. The price now is lower than it was 24 hours ago.
However, the picture is slightly less bearish, as we have a slower pace of decline, plus some short-term price action which looks like bottoming. However, bulls should not get excited: the price still has not even touched, let alone exceeded, any of the key resistance levels.
I am very comfortable taking a bearish bias if any of the key resistance levels given above are reached today and produce bearish reversal price action. Risk-off sentiment may ebb and flow, but it is not going away any time soon. In a best-case scenario where the coronavirus is contained, it will take some time for the containment to become verified.
There is nothing of high importance due today concerning either the AUD or the USD.