Hello Forex Traders,
Our focus for today is the EURAUD and the USDCHF, but before we divulge these 2 currencies I would advise to take a look at the following 2 links:
The EURAUD decreased more than half of its value from 2.10 to 1.15, but in the meantime has seen a impulsive correction of more than 3,000 pips. What is next?
Let us start with the Fibs (Fibonacci retracement level):
1) Fibbing the entire down side: there is a 382 Fibo level at 1.5240. Price stopped shy of that Fib.
2) Fibbing the first 3 waves up move (assuming a corrective nature): price has halted at the -1.00.
3) The -1.272 is exactly at the same level as the 382 Fib and the -2.0 at the same level as the 500 Fib retracement.
4) The first 3 waves up was 1,600 pips, whereas the second wave up was +/-2,800 pips, just shy of being twice as long.
The question is: will we see a continuation of the up trend towards the 382 and -1.00 confluence and later on even higher towards the 500 and -2.00 confluence? Or will there be a bigger reversal?
1) Looking at the weekly oscillator, the trend up was obviously very impulsive and usually if there was a lot of momentum pushing the currency then there is a high chance of one last break of the top.
2) Looking at the daily chart, there is a decent change that the uptrend will get one last continuation push to break the double top.
BULLISH FROM 1.3950/1.4
In my opinion the support levels at around 1.40 and the 382 Fibonacci retracement level could be a prime turning spot for one more upside and a break of the current top at 1.5050 up to the 1.5250 area or maybe even higher (1.6350 is 500 Fib of weekly chart).
I am bullish either when:
a) price makes that the bigger retracement to the 382 Fib at 1.3950 (light green) and/or
b) price breaks out above a daily fractal (blue)
What do you think of the EURAUD? Are you waiting for the turn at 1.40 as well or do you a bigger reversal coming our way? Let us know in the comment section down below!
Due to USD strength the USDCHF was able to bounce off of the weekly support and triangle (purple) and break to the upside (as anticipated in the monthly analysis), but ultimately failed to reach the top of the range in one shot.
Is this a hook back for more upside back to the top of the range or will the UCDCHF break the triangle to the downside?
In my perspective, the retracement does provide a decent reward to risk trade with sufficient probability to wager a long back towards the top of the range. The retracement could of course go deeper. There is no indication at the moment that the USDCHF will turn right here, right now for more upside. It could retrace deeper.
With that said, these are my 3 ideas for entering the trade:
1) Price action signal of a bounce at a Fibonacci level (future candle stick)
2) Break out of a correction (blue circle and purple wedge)
3) Level trading –> bounce off of the retest of the triangle bottom (green circle)
Read more about entries and defining the trend as well via these links:
Thanks for reading and sharing!!
Let us know down below if you plan on taking these trade ideas and how the trading went!
Wish you all a very good trading day and will be abck tomorrow with more Forex trading. Hope to see you later today in the trading room.
Latest posts by Chris Svorcik (see all)
- How to Trade Using Multiple Strategies - August 29, 2014
- Currency Pairs with the Most Reversal Potential - August 28, 2014
- USDJPY Triangle at Crucial Break and USDCAD at Major Bounce - August 27, 2014
Winner’s Edge Trading, as seen on: