AUD/USD 3 APRIL 2012

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

No trade setup on Aussie yesterday. Price rallied to test the 618 an hour ago and gave us a huge engulfing candle. This technically is a short trade setup, but the stop is too big at present.

FOR TODAY:

Price has just rallied to the 618 and gave us a bearish cs formation. This is a short trade setup, but I will wait to see if price tests the cs formation before a fall since the stop is some 74 pips – which is too big for me. This bearish cs formation should be good for a fall to the BF786.

If the 618 doesn’t hold we have a 786 higher up at 1.0502.

Long trade setups are considered once price hits the BF786 and then gives us a bullish cs formation.

SHORT: Will be going short only IF:

We will sell a test of the Asian high followed by a bearish cs formation. This 618 entry will be good for 60-70 pips. 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 a dip to the BF786 followed by a bullish cs formation for a long trade setup.  Place stop 10 pips below the low of the cs formation, max 1% risk. Limits on this trade will be defined at time of entry.

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