The Forex market has been moving sideways so far this week, and this pair is no exception. However, the support below at $0.6467 looks strong and likely to be pivotal.
My previous AUD/USD signal on 15th May produced a profitable trade entry from the bullish bounce at the support level which I had identified at $0.6401.
Today’s AUD/USD Signals
- Risk 0.50%
- Trades must be taken prior to 5pm Tokyo time Wednesday.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of $0.6499, $0.6517, or $0.6531.
- Put the stop loss 1 pip above the local swing high.
- 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 price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
- Go long following a bullish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of $0.6467, $0.6439, or $0.6407.
- Put the stop loss 1 pip below the local swing low.
- 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 price reaches 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.
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AUD/USD Analysis
In my previous forecast about one month ago, I thought this currency pair would continue ranging between $0.6491 and $0.6376. This was a good call, and a profitable long trade was triggered as support quite near the floor which I had identified at $0.6376.
The technical picture now is one of a selloff from a recent peak above $0.6500, but the price is now reaching a support level at $0.6467 which looks very interesting, as there was recently a double top rejecting this level from below some days ago when it was acting as resistance. These flipped levels tend to be relatively reliable, so it might well be that the price will find a floor here and give some kind of long trade entry, although a cautious scalp might be the best approach.
If the price does get established soon below this pivotal point at $0.6467, we could see a fall quite quickly to at least $0.6439.
The early signs are that the support level will hold so a long scalp could be attempted.
There is nothing of high importance due today concerning the USD. Regarding the AUD, there will be a release of CPI (inflation) data at 2:30am London time.
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