FxWirePro
Short

EUR/AUD technicals and trade setup

FX:EURAUD   Euro Fx/Australian Dollar
90 0 2
EUR/AUD breaks below supports of 1.4425, dips until 1.4072 most likely on breach of 38.2% Fibos – Snap rallies to deploy tunnel spreads:

On daily charts , last week the pair breaks major supports of 1.4515 (7DMA), and now at 1.4425 levels.

For today, the failure swings at resistance 1.4425 (previous supports) may evidence more slumps.

On broader perspectives, the pair has been rejecting below 21EMA quite often and tumbled to break below the major supports 1st at 1.4667 (38.2% Fibonacci retracements ever since the rejection of the highs of 1.6585 in the major trend), secondly at 1.4435, and for now heading towards 1.4072 levels (i.e. 50% Fibonacci levels, see monthly charts).

Yesterday’s buying momentum now seems to be absolutely shrunk away as the bearish formations such as gravestone dojis appeared back-to-back at 1.4695, 1.4694 levels and shooting star at 1.4658 levels are mounting selling pressures on daily charts .

To substantiate this bearish stance, both leading and lagging indicators popping up with the bearish momentum by converging downwards to the prevailing price dips on both daily as well as monthly terms.

RSI: Currently, RSI (14) clearly has been converging downwards below 34 levels in accordance with the ongoing price dips and so is the case on monthly signals.

Stochastic: This leading oscillator has approached oversold territory but no traces of bullish crossover. Monthly stochs still evidence %D crossover even below oversold zones that conforms to these price dips with intensified selling momentum .

Most convincingly, the robust volume build ups are in conformity to these downswings.

Both EOD             and Monthly MACD also signify the ongoing downtrend to prolong further.

Amid this considerable bearish journey we can observe the current price have consistently slid below DMA and EMAs, hence, there’s no buying interest in the medium run.

We think, in a long term bears' intensity is strengthening as there is no sign of strong buying sentiments so far.

So, the trading recommendation for the day would be good to go short via tunnel spreads (which is a binary version of the  bear put spread) when pair shows any abrupt upswings (i.e. somewhere near 1.4425 levels), it is good to go with these option strategy at every rally.  

Capturing higher strikes to effect in leveraging effect with OTM strikes for a minimum target of 35-40 pips with ease.

Related Ideas

Ideas Scripts Chart
United States
United Kingdom
India
España
Italia
Brasil
Россия
Türkiye
日本
한국
Home Stock Screener Economic Calendar How It Works Chart Features House Rules Moderators For the WEB Widgets Stock Charting Library Priority Support Feature Request Blog & News FAQ Help & Wiki Twitter
Private Messages Chat Ideas Published Followers Following Priority Support Public Profile Profile Settings Billing Sign Out