My previous signal on 27th December was not triggered as there was a small bullish bounce at the support level which I had identified at $0.6732, but it was not enough to trigger a long trade entry.
Today’s AUD/USD Signals
Risk 0.75%
Trades must be taken prior to 5 pm Tokyo time Wednesday.
Short Trade Idea
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of the upper trend line shown in the price chart below which is currently sitting at about $0.6835.
- Place the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
Long Trade Ideas
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6781, $0.6762, or $0.6731.
- Place the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 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 in my previous forecast that the AUD/USD currency pair had become more bullish, with everything pointing towards a likely continuing rise in the price.
I thought that a bullish bounce at $0.6732 could work well as a long trade entry for swing traders, but the bounce was short-term enough that it was only suitable for scalpers.
The technical picture has remained bullish since then, but it is a slow trend and has lots of deep dips.
The price chart below shows that the price is rising within a bullish wedge. Although the bullish momentum is slow or even nonexistent, and although the Australian Dollar is somewhat weak, the slow rise is being maintained by a weakening US Dollar.
What is most potentially interesting for bulls here is the fact that there are no key resistance levels overhead until $0.6953, so the price has plenty of room to rise.
Before the price can really turn bullish, there will have to be a turn in risk sentiment from risk-off to risk-on.
Although we cannot know whether there will be a turn in risk sentiment, I think long swing trades or scalps from bullish bounces at any of the nearby named support levels look attractive, especially as scalps.
There is nothing of high importance due today concerning either the AUD or the USD.
Ready to trade our daily Forex signals? Here’s are some of the best Forex platforms in Australia to check out.