Last Thursday’s signals produced a losing long trade from 0.7173.
Today’s AUD/USD Signals
Risk 0.75%.
Trades must be entered between 8 am New York time Monday and 5 pm Tokyo time Tuesday.
Long Trade Ideas
- Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.7164, 0.7130, or 0.7100.
- Place the stop loss 1 pip below the lowest recent price.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Short Trade Ideas
- Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.7229 or 0.7248.
- Place the stop loss 1 pip above the highest recent price.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
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 last Thursday that we seemed to see new crucial support forming at 0.7150 so I would remain bullish above that level.
I also thought that we may see the resistance at 0.7228 hit that day, but I thought it would hold until late Friday.
This call did not work out so well, being wrong on both counts.
As this week opens, we are seeing some recovery in risk-on sentiment, which is boosting the Australian Dollar against the U.S. Dollar. The Aussie remains a crucial barometer of risk sentiment.
We have new higher support at 0.7164 and the price is recovering quite firmly from its dip towards 0.7100.
I think we are likely to see higher prices over the New York session if it makes a new high for the day early on, but I think also that the resistance at 0.7228 will likely hold until we get crucial Australian budget and central bank meeting minutes data later during the Asian session.
Regarding the USD, there will be a release of ISM Non-Manufacturing PMI data at 3 pm London time. Concerning the AUD, the RBA will be releasing its Cash Rate and RBA Statement at 4:30 am, followed by the Australian Annual Budget at a later time.