The AUDUSD has been correcting alongside its bearish price channel as visible on this H1 chart. The pair has now reached its declining support level from the formation which should provide it for a platform to rally back to the declining resistance level of the formation. Furthermore, twin hammer candlesticks have formed at support which is a strong bullish indicator.
MACD is bearish and confirms the bearish price channel of this pair. Given the bearish momentum, MACD currently indicates that this pattern will remain intact and further declines should be expected after the rally. RSI has reached oversold territory and offer the final sign for a short rally.
We recommend taking a long position at 1.0350. There may be a potential second entry level to this trade at 1.0275 at which point traders are advised to hedge their initial long with a short using half the volume before adding to existing long positions.
Traders who prefer a clean exit with a loss are advised to place their stop loss level at 1.0275. We do not use stop loss levels in our portfolio and will remain in this trade hedged as mentioned above. Place your take profit level between 1.0400 and 1.0420.
