My previous AUD/USD signal on 19th June produced a profitable long trade from the bullish rejection of the support level I identified at $0.6450.
Today’s AUD/USD Signals
- Risk 0.50%
- Trades must be entered 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 $0.6553, $0.6562, or $0.6582.
- 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
- Long trade following a bullish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of $0.6517, $0.6484, or $0.6461.
- 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.
AUD/USD Analysis
In my previous AUD/USD forecast on 19th June, I wrote that this currency pair was looking bearish so I was seeking a short trade from a resistance level.
Although the main trade opportunity of the day was a long trade, there was also a short opportunity later, although it was not as good as the long one, so my call was OK.
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The technical picture has not changed a lot within the past few weeks, as Forex markets generally have been quiet. However, the RBA policy meeting a few hours ago passed on a widely expected rate hike, sending the Aussie higher and making it the strongest currency of the day so far. That might change as more analyst now wonder whether the next rate cut, which is very likely to happen in August, might now be bigger than 0.25%.
Technically, the line of least resistance looks likely to be downwards, as we have several key resistance levels bunched up close by overhead to the current price. However, the support level at $0.6517 looks exceptionally strong, so I would only see an opportunity short down as far as that area. The big round number just below at $0.6500 will be strengthening that support.
So, the best approach overall, will be to wait for a short scalp trade entry from another rejection of the resistance level at $0.6552, targeting $0.6520 or so.
There is nothing of high importance due today concerning either the AUD or the USD.
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