AUD/USD Forex Signal: Short-Term Bearish Price Channel

Market sentiment is a little mixed in the absence of any real fresh data releases but is slowly deteriorating towards risk-off.

AUD/USD: Sentiment mixed but risk-off strengthening

Yesterday’s signals may have produced a profitable short trade from the bearish reversal from the resistance level at 0.6970.

Today’s AUD/USD Signals

Risk 0.75%.

Trades may only be entered 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 0.6885.
  • 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 0.6951 or 0.6972.
  • 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.

AUD/USD Analysis

I wrote yesterday that I was willing to take a short trade if we had gotten a firm bearish reversal following a retracement to the resistance level at 0.6951.

Unfortunately, the significant bearish turn where it would have been a good idea to make a short trade entry occurred just barely above the higher resistance level at 0.6970, which I have adjusted upwards slightly to 0.6972.

The technical picture has become more bearish due to the short-term symmetrical bearish price channel which seems to be effectively pushing the price down.

Market sentiment is a little mixed in the absence of any real fresh data releases but is slowly deteriorating towards risk-off, which will certainly help bears here.

I would again be happy to take a short trade from a bearish reversal at 0.6951 which is confluent with a half-number and the upper trend line of the short-term bearish price channel.

AUD/USD

There is nothing of high importance scheduled today regarding 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.