AUD/USD Forex Signal: Weakly Bullish

Adam Lemon

I think long trades from bounces at support levels are the way to go today. The technical picture will start to look more bullish once the price has made a few hourly closes below the new resistance level at 0.6164.

 

Yesterday’s signals produced a losing long trade from 0.6130.

Today’s AUD/USD Signals

Risk 0.75%.

Trades must be taken between 8am New York time Wednesday and 5pm Tokyo time Thursday.

Short Trade Idea

  • Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6164.
  • 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

  • Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6126, 0.6102, 0.6067, or 0.6050.
  • 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.

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AUD/USD Analysis

I wrote yesterday that I expected the price to continue to rise, but the inflection area nearby at 0.6200 could produce some resistance.

I was seeking to take a long trade from a retracement and bullish bounce at any of the support levels.

This was mostly not a great call as after briefly rising, the price has fallen over the past day, and broken below the first likely support level I gave yesterday.

Overall, this seems to be a normal bearish retracement due mostly to a little strength in the USD which we are seeing everywhere. This means we still basically seem to have a bullish technical picture, which is supported by a broken trend line and several horizontal support levels below the current price.

I think long trades from bounces at support levels are the way to go today. The technical picture will start to look more bullish once the price has made a few hourly closes below the new resistance level at 0.6164. I would not want to take a short trade from a bearish rejection of that resistance level as I have little confidence in bearish follow-through.

 

AUD/USD

There is nothing of high importance scheduled for today concerning either the USD or the AUD.

About the Author
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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