AUSUSD - Good risk/reward for going short with 0,9200 tgt
Two days ago I've called your attention for possible sell signals in AUDUSD. Since then price has not changed much, in fact it started consolidate in the Kumo Cloud on 4 Hrs time frame. However within 2 days charts produced more signals that makes me more confident with going short here, with a nice risk/reward. Let's put it together:
Daily - Bearish engulfing candle two days ago. Slow Stoch bearish, MACD gave sell signal too. DI+ crossed below ADX line which often means the trend momentum exhausts, and the instrument minimum takes breath and pulls back.
The Price moved a bit far away from the Cloud and the Kijun Sen, which calls for correction too. But keep in mind that the Ichimoku components on daily chart are still absolutely bullish, so the pull back tgt can be ard the trendline and/or Kijun Sen, possibly around 0,9200.
4 Hrs - Price is in the Kumo Cloud, which means instrument is not trending now on this time frame. The very low ADX and zig-zag DMI tells us the same. Price have retested teh Kijun Sen and top of the cloud, where refused to go higher, and formed 3 lower highs, this means chance for a possible breakdown is increasing. Tenkan is below Kijun, also Chikou Span is below Price candles, these are medium bearish signals. The Key level here is 0,9330, where a break below 100 WMA and the Kumo Cloud will accelerate bearish momentum.
Strategy: Build short position within 0,9360 - 0,9390 range. Double up teh size on the break below 0,9330.
Initial Stop at 0,9405 (which after double position is on will have to be lowered to 0,9385). Target 0,9200. Expected Risk/Reward: 3,7.
Daily - Bearish engulfing candle two days ago. Slow Stoch bearish, MACD gave sell signal too. DI+ crossed below ADX line which often means the trend momentum exhausts, and the instrument minimum takes breath and pulls back.
The Price moved a bit far away from the Cloud and the Kijun Sen, which calls for correction too. But keep in mind that the Ichimoku components on daily chart are still absolutely bullish, so the pull back tgt can be ard the trendline and/or Kijun Sen, possibly around 0,9200.
4 Hrs - Price is in the Kumo Cloud, which means instrument is not trending now on this time frame. The very low ADX and zig-zag DMI tells us the same. Price have retested teh Kijun Sen and top of the cloud, where refused to go higher, and formed 3 lower highs, this means chance for a possible breakdown is increasing. Tenkan is below Kijun, also Chikou Span is below Price candles, these are medium bearish signals. The Key level here is 0,9330, where a break below 100 WMA and the Kumo Cloud will accelerate bearish momentum.
Strategy: Build short position within 0,9360 - 0,9390 range. Double up teh size on the break below 0,9330.
Initial Stop at 0,9405 (which after double position is on will have to be lowered to 0,9385). Target 0,9200. Expected Risk/Reward: 3,7.
