Fundamentally, the Euro is weaker than the Aussie. Thus over the longer term, i’m expecting the Euraud to further depreciate. Looking at the chart below I’ve identified a level to go short and possibly riding the move further downwards.
We’ve had a nice rally on the Gbp is recent days. Thus i’m looking to get long on this pair as well.
Usdcad has been in an uptrend since August 2012. Right now it’s pulling back towards the support level with confluence of the upward trendline.
Do note that there will be an FOMC speech tonight and that will rattle the markets. I will expect volatility because the word ‘tapering’ has been a hit these days. There could be a chance thatthe FED will begin tapering and that could potentially affect most pairs.
Thus if you’re not in any trade, you may want to hold off till the news is out. If you’re in a trade, allow your stops for the volatility that will kick in later on.
Concerning your eur/aud chart, I do not know much about the fundamental on it but seems quite a strenght on the upside, the 2 hammers, long tail candle is maybe a potential reversal, (gather stop loss and liquidity to push higher?). From 1.42500 and your line 1.44 is the limit of the current box, did you not long the current market? with the expectation of taking some profit on your 1.44 and maybe see for a reversal. ad if break the 1.44 you are still on the trade.
I did not long the current market. If i were to long, i would like price to fall to around 1.4220 level before getting long.
To me price is now in no man’s land.
If it approaches the 1.4400 level i will look to short as per my analysis.
How did you discern that the Euro is fundamentally weaker than the Aussie? Did you do this based on news or the general chart trend (how EU reacts vs how AU reacts to when the dollar goes up/down)?
From a technical view point, looking at the monthly chart price is still in a downtrend if you ask me. On the daily chart price formed a double top and closed below the 1.4400 level which turned me bearish.
Fundamental wise, the euro zone crisis is far from over. We have portugal, greece italy etc in debt and chances are they have problems repaying them. Just because the news are not focusing on these issues right now does not mean that the issue is solved.
Looking at the Aussie, the reason why they have depreciate the last few months is because of the slowing growth in china. China is still growing, but at a slower pace. Compare the euro who’s debt is rising with a high probability of default and Aussie who’s growing at a slower pace (due to china), which is fundamentally stronger?
I’ll go with the Aussie any day any time.
Hope that helps!