AUD/USD Forex Signal: Aussie Bouncing Back

Support at $0.6836 looking pivotal.

My last signal on 7^th June was not triggered as there was no bearish price action when the resistance level identified at $0.6705 was first reached.

Risk 0.75%

Trades may only be entered before 5pm Tokyo time Tuesday. 

• Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of $0.6895, $0.6936, or $0.6949.
• 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.

• Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6836 or $0.6757.
• Place 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.

I wrote in my previous forecast that the AUD/USD currency pair was in trusting the short to medium-term bullish momentum and watching what happens at the support levels when they are reached. This was enough to keep out of trouble as nothing happened when support was reached that day.

The technical picture here has changed since then. The US Dollar is notably weaker after the Federal Reserve passed on a rate hike last week, while the Australian Dollar has been boosted by a rising level of risk sentiment, especially strong increases seen recently in Asian equities. This last factor took a bit of a knock over recent hours as it became obvious there will not be any Chinese monetary stimulus soon, but markets are starting to bounce back from that disappointment.

Technically, we see the price as having made a firm bullish bounce at the key support level at $0.6836. This makes it look likely that today will be an up day, but it may be too late now here to find a good entry point for a new long trade.

I am ready to enter a long trade if we get another solid bounce at $0.6836, or in the unlikely event that we get two consecutive hourly closes later above $0.6900 which would be a very bullish sign.

There is nothing of high importance due today regarding either the AUD or the USD. It is a public holiday today in the USA.

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