AUD/USD Forex Signal: Strongly Bullish

Adam Lemon

The Australian Dollar has become a real risk barometer in recent months, rising firmly when prospects for global growth seem to be improving and falling when there is a flight into safe havens.

AUD/USD: New 1-year high prices again

Yesterday’s signals were not triggered, as there was no bearish price action at either of the resistance levels which were reached.

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 0.7118, 0.7109, or 0.7035.
  • 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 following bearish price action on the H1 time frame immediately upon the next touch of 0.7152 or 0.7197.
  • 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 that I would be very happy to take a long trade in this pair if there were retracements to any of the support levels above 0.7000 with fast, firm bullish bounces.

Unfortunately, there were no retracements to any of the support levels I had identified, but I was correct to look to a long direction, as we have seen a very strong rise in this currency pair over the past 24 hours.

The Australian Dollar has the greatest long-term strength of any currency and has powered up to make new 1-year high prices – bullish signs.

The Australian Dollar has become a real risk barometer in recent months, rising firmly when prospects for global growth seem to be improving and falling when there is a flight into safe havens.

This effect has become even more pronounced, as the USD’s recent weakness begins to accelerate and crystallize into a long-term bearish trend.

It seems now that this strong bullish movement may be taking a rest at the area of resistance it has reached, but a continued advance is possible. Therefore, I am prepared to take a bullish bias if we get two consecutive hourly closes later above 0.7152, up to 0.7197.

AUD/USD

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