AUD/USD Forex Signal: Double Top at 0.6950

Adam Lemon

Yesterday’s signals were not triggered as neither 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.

 

Long Trade Idea

  • Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6868.

  • 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 scalp upon short-term bearish price action the first time 0.6950 or (even better) 0.7000 is reached.

  • Place the stop loss 1 pip above the highest price made today.

  • Adjust the stop loss to break even once the trade is 10 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 I would look for a long trade at 0.6868, but also that there could be an opportunity for at least a short scalp if 0.7000 was reached.

This call was not tested as the price has not hit either level.

We see a bearish double top at 0.6950, but we also see every support level holding, with the nearest one at 0.6868 not having been touched yet.

I still see a bearish reaction giving a potential short scalp as likely to happen if 0.7000 or even 0.6950 is reached, but I still see a long trade at a bounce at 0.6868 as looking like a good trade.

There has basically been no change to the technical picture in this currency pair since yesterday, with the Australian Dollar having great long-term strength. This retracement just looks like a normal pull back within a long-term bullish trend,

AUDUSD

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

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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