AUD/USD Forex Signal: Going Sideways

Adam Lemon

AUD/USD: Hard to predict next major directional move

Yesterday’s signals were not triggered as none of the key levels have been reached yet.

Today’s AUD/USD Signals

Risk 0.75%.

Trades may only be taken from 8 am New York time Thursday to 5 pm Tokyo time Friday.

Long Trade Ideas

  • Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.7090, 0.7070, or 0.7046.
  • 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 0.7117 or 0.7145 / 0.7150.
  • 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 fact that the price broke above three resistance levels and was still holding up above the former resistance level at 0.7070 as new support, was a bullish sign. I saw the best potential here as a long trade, especially from 0.7070 if that level holds as support.

This was an OK call as the price moved up quite firmly yesterday, so I was correct to look to the bullish side above 0.7070.

However, the deterioration in risk sentiment and the advance by the U.S. Dollar which we have seen over recent hours has pushed the price lower, with a lower high printed at the new resistance level of 0.7117.

The price is currently packed in between several support and resistance levels quite close by with neither bulls nor bears really having a strong advantage.

I am less confident this week will be an up week, and I think it may be best to stand aside from trading this currency pair today until the directional movement becomes clearer.

AUD/USD

There is nothing of high importance due today concerning the AUD. Regarding the USD, there will be a release of Unemployment Claims data at 1:30 pm London time.

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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