SIGNAL FOREX

AUD/USD Forex Signal: Bullish Above 0.7548 – DailyForex.com


Today’s AUD/USD Signals

Risk 0.75%

Trades must be entered prior to 5pm Tokyo time Wednesday.

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 0.7636 or 0.7649.
  • Put 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 0.7577, 0.7548, 0.7537, 0.7524, or 0.7508.
  • Put 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.

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AUD/USD Analysis

The AUD has made a very strong recovery since last Friday’s US non-farm payroll data release, after reaching long-term low prices. Although several currencies have advanced against the USD over this period, the AUD has been leading the field. This is probably because the relatively strong new jobs data has boosted risk appetite in the markets, with the AUD seen as a leading “risk” currency.

Technically, we see a lot of clear support levels below the current price, which are quite tightly packed all the way down to the big round number at 0.7500. This suggests that it would be very difficult for the price to fall quickly by much from its current level.

The Reserve Bank of Australia left its cash rate unchanged and signaled an unchanging monetary policy earlier, but there are beginning to be hints that the big QE operation will begin to be tapered. In any case, this event does not seem to have had much direct impact upon the AUD, so it seems that the price here is being driven mostly by other factors right now.

It seems likely that we will see a short-term bearish retracement right now, maybe to the support level at 0.7548 or the half number just above it at 0.7550. I think this would be a natural price movement, with the key thing to watch then becoming whether 0.7548 holds up.

A long trade from a bullish bounce there later today could be an attractive trade.

AUD/USD

Regarding the USD, there will be a release of ISM Services PMI data at 3pm London time. There is nothing of high importance scheduled today concerning the AUD.

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