Hi, I'm Chris Capre, founder of 2ndSkiesForex. I'm a verified profitable trader and trading mentor. As a professional trader, I specialize in trading Price Action and the Ichimoku cloud. As a trading mentor, I have one goal: to change the way you think, trade and perform using 18 years of trading experience and cutting edge neuroscience to wire your brain for successful trading. Want to improve your trading edge and mindset? Check out my trading courses here.
Forex Trade Signals and Setups Jan 18th
AUDUSD – Tentative, But Making Ground
After finally exiting the termination wedge we talked about in our previous post, the Aussie has finally broken the top of the formation. However, the initial break was a false break, likely trapping bulls who took the break and are either a) still in the position, or b) shaken out.
This type of price action and false breakouts generally create two scenarios;
1) The shaking out of the initial bulls via the false break could have prompted traders to take fresh shorts – which would actually be good for the bulls still in (or wanting to get in) since the institutional players may want to take it higher. By having fresh shorts in, them getting stopped out would add steam to an upside play.
2) the other scenario is the false break has trapped some new longs, so if the market fails to clear the breakout highs, then any aggressive selling back into the wedge would communicate this is what is happening, and the trapped bulls will have to exit, thus adding verve to the sell-off. If this were to play out, expect price to drop minimally to the 20ema just under 1.0300 and then gun for 1.0250 in a jiffy. The price action trigger to watch for here would be aggressive or impulsive selling, then price action holding under yesterdays low of 1.0358. Traders can look to the 1hr and 4hr time frames for entries to play the short side should this play out.
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Also make sure to view out latest article Reading Price Action – Key Price Action Elements to Breakouts Part 1.
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