AUD/USD: Price more likely to reach 0.7292 soon
Yesterday’s signals may have produced a short trade from 0.7395 and a long trade from 0.7372, with the short trade giving a net profit.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be entered from 8am New York time Wednesday to 5pm Tokyo time Thursday.
Long Trade Ideas
- Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.7372 or 0.7292.
- 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 0.7395 or 0.7419.
- 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 the long-term bullish trend was strong and likely to remain in force, so the best trades would probably be buys from bounces at support levels. Yet I saw a retracement to the support at 0.7292 as quite likely to happen so I would wait before buying this currency pair unless we got two consecutive hourly closes above 0.7419.
This was a reasonably good call and would have kept you out of the failed long trade at 0.7395. However, it also would have kept you out of the potential short trade which set up at 0.7395. In any case, it looks like I was correct about the price moving down to 0.7292.
I think the price will continue to move down although there are hints of a supportive floor forming at about 0.7340. I had thought once it got to this level it would fall more rapidly.
Technically a further fall does look likely, but there is a chance that the U.S. new jobs forecast which will be released near the New York open could push the price around in a surprising way if it deviates from the market’s consensus.
I still see the best potential trade set up as a long from a bullish bounce at 0.7292 or possible even just the round number at 0.7300 which is obviously very close by.
Concerning the USD, there will be a release of the ADP Non-Farm Employment Change Forecast at 1:15pm London time. There is nothing of high importance due today regarding the AUD.