AUD/USD 20 MARCH 2012

AUD/USD - follow me on twitter @fxdailyforecast and www.stocktwits.com/fxg

No trade setup on Aussie yesterday, price gave us the swing high, tested it and fell back into the AB swing. We will place our new swing high at 1.0636.

FOR TODAY:

Past resistance is acting as support here circa 1.0560. Today we will look to sell a test of the high followed by a bearish cs formation.

Else a sustained break of the 1.0636 high will give us a new AB swing in play.

Long trades are only considered once price retraces to the 618/786 of this swing.

SHORT: Will be going short only IF:

We need price to rally to test the highs and then give us a bearish cs formation. Trade this for 70 pips since we have a shallow bounce. Place stop 13 pips above the high of the cs formation, max 1% risk.

If we don’t get the setup we are looking for then we don’t trade.

LONG: Will be going long today only IF:

We need price to retrace to the 618/786 of this swing followed by a bullish cs formation at either of those levels. Place stop 10 pips below the low of the cs formation, max 1 % risk, limits defined at time of entry.

If we don’t get the setup we are looking for then we don’t trade.