TODAY WE GET THE ECB INTEREST RATE DECISION, WHICH IS EXPECTED TO REMAIN UNCHANGED. MY BIAS ON THE EURO IS BEARISH DUE TO FUNDAMENTALS INCLUDING THE POLITICAL RISKS SURROUNDING EUROPE.
”ECB TO SIT TIGHT AHEAD OF POTENTIAL ELECTION UPSET”

EURAUD DAILY

MARKET IS BEARISH, 55 ABOVE THE 21 EMA. PRICE OPENED AT MM2 IN THE BEGINNING OF THE MONTH & BULLS PUSHED PRICE TO ITS CURRENT LEVEL AT MM3. RESISTANCE AT MM3 ROLE REVERSAL/61.8 FIB/55EMA. STOCHASTICS IS OVERBOUGHT. AS A BEAR ONE WOULD LOOK TO SHORT AT @ 1.40500 AS PRICE IS MAKING BEAUTIFUL LOWER HIGHS & LOWER LOWS.

EURAUD H4

MARKET IS SIDEWAYS. PRICE IS CURRENTLY BETWEEN WM3 & WR1 RESISTANCE. IMMEDIATE RESISTANCE AT 1.40500 THAT COINCIDES WITH MM3. STOCHASTICS OVERBOUGHT. THE H4 CHART IS ALIGNED WITH THE DAILY CHART SO A BEAR IS LOOKING FOR SHORT ENTRY AT RESISTANCE.

EURAUD H1

PRICE IS CURRENTLY HEADING TOWARDS DR1 RESISTANCE AND SUPPORT IS AT DPP. I WILL WAIT FOR STOCHASTICS TO BE OVERBOUGHT AND FOR PRICE TO GET TO OR CLOSE TO 1.40500 TO SHORT. KEEPING IN MIND THE ECB WILL ANNOUNCE THE INTEREST RATE AND A PRESS CONFERENCE SHORTLY AFTER.

4 thoughts on “EURAUD SHORT SETUP, 09 MARCH 2017”

  1. Teboho Faro says:

    I like how you maintain your bias in all timeframes

    1. Pedro says:

      Thanks Teboho, a bias is very important in this game

  2. Ryan Gandalf van Jaarsveld says:

    Hey Pedro

    Thanks for the trade plan. Here’s some feedback to help you identify where you are going right and where you are going wrong.

    Daily
    1. 21 and 55 are flat. Price has broken through the 21 which is not very bearish currently. When the 21 and 55 are flat there is no market and therefore the 21 and 55 are useless. When this happens the market is ranging and we use our range trading strategy – sell at the top with an overbought stochastic or buy at the bottom with an oversold stochastic. The only other way we can trade a range is when price breaks the range. If this happens we trade the pull back. Now I know you know all of this though it is important to understand that if the 21 and 55 are flat it does not matter which one is above the other as there is no market.
    2. Price did open at MM2 at the start of the month and therefore the Bullish target for the month is MM4. I agree with the resistance you eye at MM3 – this is where I would expect to see Bears selling and if not at MM3 then 1.41. I agree with your use of fib because I do see this as a lower high. I know your question would be how can we have a flat market with a lower high, surely a lower high indicates a bearish trend and my answer would be that the 21 and 55 indicates what current market conditions are while analysis of price action may show a larger macro move in play.

    H4
    1. I like how you have used your monthly confluence correctly. Often traders forget their daily trade plan when they get onto H4. H4 might indicate further support or resistance though one has to also identify where their daily trade plan fits in on the H4 chart. You have clearly marked where MM3 is on the H4 chart so it doesn’t feel like H4 is a totally new trade plan.
    2. I see you have daily confluence on your H4 chart. This is not necessary. I suggest using monthly confluence on H4 and monthly and weekly confluence on H1. You want to bring support and resistance levels from higher charts down to lower time frame charts. The reason is that you can see the range for the daily pivots is a lot smaller than the week’s range so you end up with clutter.
    3. I agree that overall the market is sideways though we have made a higher high. I like that you have identified this and provided a trade setup which accounts for bulls buying at support/ previous resistance.

    Overall good job. The only thing that would stop me from taking this trade if I was a Bear would be the risk event today. If I was going to be in this trade ahead of the ECB meeting as a seller then I would like to have been in the market at the beginning of Feb of Feb’s MPP. Selling just before a central bank meeting is pretty dangerous. It is a pity though because if Euro weakness is the result of the meeting today this could be a very nice trade – especially with where AUD is at the moment. You might consider a news scalp though be careful of this whipsaws.

    Keep up the good work bud!

    Best
    Ryan
    Coach @ MetaTraders.com
    Analyst @ Forex.Today
    Skype: Ryan.Gandalf
    e-mail: [email protected]

    1. Pedro says:

      Thanks for the feedback Ryan, it really helps

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