A great setup here on EURAUD that should delight many swing traders. Here's what we see:
1. Price is in a clear downtrend, below 50 SMA which in turn is below the 200 EMA
2. Price makes a 61.8% pullback from recent swing high to swing low
3. This 61.8% level intersects with the 50 SMA
4. Candlesticks show signs of exhaustion
All these factors, in addition to the fact that we are seeing signs of AUD strength and EUR weakness against other currencies, make this an easy decision to short the pair. I'm set to enter at 4438, with my stop at 4498 and my target profit at the previous lows of 4218. I'm risking 60 pips to gain 220, which gives me a reward/risk ratio of about 3.67.
www.informedtrades.com
1. Price is in a clear downtrend, below 50 SMA which in turn is below the 200 EMA
2. Price makes a 61.8% pullback from recent swing high to swing low
3. This 61.8% level intersects with the 50 SMA
4. Candlesticks show signs of exhaustion
All these factors, in addition to the fact that we are seeing signs of AUD strength and EUR weakness against other currencies, make this an easy decision to short the pair. I'm set to enter at 4438, with my stop at 4498 and my target profit at the previous lows of 4218. I'm risking 60 pips to gain 220, which gives me a reward/risk ratio of about 3.67.
www.informedtrades.com
