My previous AUD/USD signal on Wednesday last week may have produced a losing short trade from the rejection of the resistance level at $0.6323.
Today’s AUD/USD Signals
Risk 0.50%
Trades may only be entered before 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 $0.6268, $0.6331, or $0.6348.
- 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 Idea
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6220.
- 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 forecast last week, I thought that the nearby resistance level was likely to be strong and hold. This was not a good call.
The outlook has become more bearish, as markets make impulsive bearish moves in stocks, and new US tariffs will be announced tomorrow which could hit Australian exports, both directly and indirectly.
Another factor is the policy meeting at the Reserve Bank of Australia earlier today which left rates on hold at 4.10% as expected, but the Governor expressed optimism on inflation which might be a minor dovish tilt which would increase bearish pressure on the price here.
Technically, the outlook is bearish, as we see new lower resistance levels printed and bearish price action patterns dominating recent trading.
A short trade from $0.6268 may be appropriate if we get a retest of that level from below which fails with some bearish momentum.
If the price gets established above $0.6268, which is not likely, that would be a bullish sign. The level seems likely to be pivotal today.
There is nothing of high importance due today concerning the AUD. Regarding the USD, there will be releases of JOLTS Job Openings and ISM Manufacturing PMI data at 3pm London time.
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