My previous signal on 3^rd August was not triggered, as unfortunately the reversals that day happened just a few pips past both the nearest support and resistance levels.
 

Today’s AUD/USD Signals

• Risk 0.75%
• Trades may only be entered prior to 5 pm Tokyo time Wednesday. 
   

Short Trade Ideas

• Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of $0.6517 or $0.6609.
• 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 entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of $0.6500, $0.6438, or $0.6387.
• Put 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

I wrote in my previous forecast on 3^rd August that the AUD/USD currency pair might provide an opportunity to enter a short trade from a bearish reversal at any resistance level, but also that the support near $0.6500 could slow the descent.

This was a good call as the price did find support near $0.6500 after falling.

The technical picture became more bearish in recent days as the price fell as risk appetite soured, hitting the AUD, while money flowed into the USD on increasing yields and as a safe haven destination.

However, over the past day or two, we have seen a short-term bullish head and shoulders pattern form at the lows, printing a neckline confluent with the big round number at $0.6500. The price has now made a bullish breakout above that level, which is a bullish sign.

This may have been the day’s pivotal point, but there is a resistance level very close by at $0.6517.

The best approach here will be either to look for a long scalp from another touch of $0.6500, or to enter a long if we see two consecutive higher hourly closes above $0.6530 before the New York close.

(Click on image to enlarge)

More By This Author:

Forex Today: USD/JPY Reaches New 9-Month High Above ¥145
Trading Support And Resistance - Sunday, Aug. 13
Nasdaq 100 Index, USD/JPY, NZD/USD, Gasoline Futures