Forex Trade Review: AUD/USD Rising Wedge Breakout

We saw a big rally in risk-on sentiment today, pushing buyers into the comdolls, including the Aussie.  It was enough to trigger my adjusted stop in AUD/USD to close out my trade for a small profit. Here’s a quick forex trade review.

Short AUD/USD

Original Trade Idea: Forex Trade Idea: Rising Wedge on AUD/USD?

AUD/USD 4-Hour Forex Chart

AUD/USD 4-Hour Forex Chart

After breaking below .6900 and rolling down my stop to to .6965 to lock in profits last week, AUD/USD had trouble starting another leg lower.  And it was likely the European Central Bank’s monetary policy meeting today that prompted forex traders to go bullish on risk assets on the idea we may get more quantitative easing from Draghi and company.  High-yielders everywhere rose after the event, including AUD/USD, which pushed higher to my adjusted stop and closed me out at .6965. 

Total: +202 pips/ +0.12% gain

Overall, I’m happy with how this trade went, and I’ll likely take another short position on this pair since a bounce would bring the pair up to create a simple trendline “break and retest” setup.  I’ll probably go a little bit bigger on my next short because this small win gives me a little more wiggle room in my risk tolerance.

So, I’m going back into watch mode for new setups, as well as keep an eye on my long-term long position on NZD/CAD. Stay tuned by following me on Twitter and Facebook!

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