AUD/USD Forex Signal: Bullish Breakout Above 0.7000

Adam Lemon

Despite my focus on the round number at 0.7000 I will be happy to take a long trade later today if we get a retracement to 0.6990 and a bullish bounce there, once the price is also back above the 0.7000 level.

AUD/USD: Improving risk sentiment boosts Aussie

Yesterday’s signals were not triggered, as the price did not retest the support identified at 0.6926 after the New York open.

Today’s AUD/USD Signals

Risk 0.75%.

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

Long Trade Ideas

  • Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6991 or 0.6963.
  • Put the stop loss 1 pip below the lowest recent price.
  • Move 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 run.

Short Trade Ideas

  • Short entry immediately upon the next touch of 0.7109.
  • Put the stop loss 1 pip above the highest recent price.
  • Move 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 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 a breakdown below 0.6926 would see the completion of a bearish head and shoulders pattern from 0.7000, and as such could trigger a sharper, further move down.

Alternatively, if the price could get established above the round number at 0.7000, that would be a bullish sign.

We have seen the price get established above 0.7000 now, moving upwards with good short-term momentum in the last hour or so. This suggests that we are going to see a continued advance today and the price will probably reach the 0.7100 handle later this week, although it is unlikely to happen today.

Despite my focus on the round number at 0.7000 I will be happy to take a long trade later today if we get a retracement to 0.6990 and a bullish bounce there, once the price is also back above the 0.7000 level.

AUD/USD

Concerning the AUD, there will be releases of Unemployment Rate and Employment Change data at 2:30am London time. There is nothing of high importance scheduled today regarding the USD.

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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