Analysis:
Looking at the chart and price action we can clearly see that price is in a downwards trend. We're forming lower lows and lower highs which confirms that we're in a downwards trend. Bearing this being in mind we're only looking for short setups. If we look at the previous lower low we have a strong area to enter from. Whys this? Well this area has held multiple times in the past as both support and resistance so we expect that it will do it again. Also in a downwards trend we'd expect price to pullback to the previous lower low to put in a new lower high before continuing to the downside and this is what we're seeing now. For more added confluence at this area we also have the 61.8% fib retracement level which is often classed as the strongest fib level. We expect that sellers will be sat at this level wanting to push price down further, so this helps out our bearish thesis. We also have a downwards trendline very close by. This trendline has been respected in the past so we expect that it will be respected again and we will see sellers enter into the market pushing price down further. Fundamentally the EUR is the strongest major currency compared to the AUD which is the 6th strongest major currency so this really doesn't go in our favour but in recent news events we've actually see some bullish news come out for the AUD with regards to unemployment claims and other key events whereas for the EUR it's been slightly mixed. This to us looks like early signs that we could be seeing some bullishness for the AUD and some bearishness for the EUR soon, which is why we want to get on this move before it happens so we can catch a great trade. With all of the confluences that we have both technically and fundamentally we have a bias to the downside which is why we're bearish EURAUD.
Please feel free to leave any comments you have and like this idea if you agree with us. Any feedback or comments will be read. We appreciate it all.
Stay Safe - JPI
Disclaimer:
This does not constitute as financial advise. We are not responsible for any monetary loss that you endure. Trading is hard to be profitable with and we take losses just like everyone else does to. Our ideas won't always be correct which is why we urge you to always do your own analysis first before entering into the market but please feel free to use our analysis to assist you with yours.
Looking at the chart and price action we can clearly see that price is in a downwards trend. We're forming lower lows and lower highs which confirms that we're in a downwards trend. Bearing this being in mind we're only looking for short setups. If we look at the previous lower low we have a strong area to enter from. Whys this? Well this area has held multiple times in the past as both support and resistance so we expect that it will do it again. Also in a downwards trend we'd expect price to pullback to the previous lower low to put in a new lower high before continuing to the downside and this is what we're seeing now. For more added confluence at this area we also have the 61.8% fib retracement level which is often classed as the strongest fib level. We expect that sellers will be sat at this level wanting to push price down further, so this helps out our bearish thesis. We also have a downwards trendline very close by. This trendline has been respected in the past so we expect that it will be respected again and we will see sellers enter into the market pushing price down further. Fundamentally the EUR is the strongest major currency compared to the AUD which is the 6th strongest major currency so this really doesn't go in our favour but in recent news events we've actually see some bullish news come out for the AUD with regards to unemployment claims and other key events whereas for the EUR it's been slightly mixed. This to us looks like early signs that we could be seeing some bullishness for the AUD and some bearishness for the EUR soon, which is why we want to get on this move before it happens so we can catch a great trade. With all of the confluences that we have both technically and fundamentally we have a bias to the downside which is why we're bearish EURAUD.
Please feel free to leave any comments you have and like this idea if you agree with us. Any feedback or comments will be read. We appreciate it all.
Stay Safe - JPI
Disclaimer:
This does not constitute as financial advise. We are not responsible for any monetary loss that you endure. Trading is hard to be profitable with and we take losses just like everyone else does to. Our ideas won't always be correct which is why we urge you to always do your own analysis first before entering into the market but please feel free to use our analysis to assist you with yours.
Trade active:
With our entry criteria met and our order being filled we're now short EURAUD expecting that we will see some continued bearishness for the EUR, causing price to fall to the downside!
Comment:
Last night we had a big push up on EURAUD which put our trade into drawdown but with the worse then expected figures that came out this morning we've since seen some weakness for the EUR which was expected (as mentioned in our original post). On the current daily candle we have a huge wick and if this candle is able to close with this big wick then this would be a good for us as this shows the bearish pressure and the bullishness weakness which goes in favour of our idea. On Wednesday next week we have CPI coming out for the AUD which if is bullish then we expect that this will be the catalyst we need for the bears to enter into the market and push price down further. Currently things are looking good and if we get that daily candle close that we want then things will look even better. With the CPI on Wednesday this could be the final factor that we need to get the move that we expect. If CPI does come out bearish then we will see how the market reacts and will re-evaluate our trade but currently we like the look of how this trade is playing out.
Comment:
On Friday we didn't get the close that we we're expecting and price made a pretty nice move to the upside which doesn't go in favour of our idea but we are heading into another key level which has held in the past and that we expect will hold as resistance now, then we'll get the move to the downside that we're expecting. If price breaks above this level then we will re-evaluate our idea and let you all know. On Wednesday we do have CPI coming out on the AUD which could be the catalyst that we need to spark that bearish move but we'll give our thoughts about this closer to the time.
Trade closed: stop reached:
Trade Closed
(-1R) Lost
After Trade Comments:
This trade did start off pretty well for us however price did end up going against us. Yesterday we saw signs that price was going to react off of the area that we updated you all with but due to the worse then expected news for the AUD that came out this morning, price made a move to the upside which in turn stopped us out. Whilst this is a loss we're fine with this as its part of trading and we have other trades which are currently going well. Remember traders, don't dwell on your losses they are a part of trading. Instead focus on the next setup.
Stay Safe - The JPI Team
(-1R) Lost
After Trade Comments:
This trade did start off pretty well for us however price did end up going against us. Yesterday we saw signs that price was going to react off of the area that we updated you all with but due to the worse then expected news for the AUD that came out this morning, price made a move to the upside which in turn stopped us out. Whilst this is a loss we're fine with this as its part of trading and we have other trades which are currently going well. Remember traders, don't dwell on your losses they are a part of trading. Instead focus on the next setup.
Stay Safe - The JPI Team