The Weekly Update: EURUAD Technical Outlook

As noted in our prior updates we are continuing to expect a strong Euro in the Foreign Exchange (Forex) market. Due to the impact the upcoming French elections had on the Euro it is difficult at this stage what may trigger the gains but we suspect it may be related to the European Central Bank (ECB) monetary policy. Should Mario Draghi downsize the QE it may be perceived as tapering, which may strengthen the Euro against a basket of currencies. We should highlight that at the time of this writing the gains appear to be limited to EURUSD and EURAUD. We did consider initiating a long EURAUD trade on Thursday’s daily close but due to the fact we were nearing the end of the week we decided to remain on hold and wait for the weekly close.

EURAUD Daily Chart

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The Weekly Update: EURUAD Technical Outlook

EURAUD Daily Chart 26/02/17

The positive divergence in the Relative Strength Index (RSI) indicated the trend may reverse higher. The bearish retracement on Friday was insufficient to allow us to layer a tight stop in the long trade. 1.3730 is an intraday support, which is expected to hold. As we are entering at a high price t, the protective should be layered beneath 1.3627, which is a fairly large stop as it is intended to absorb any downside pressure on EURAUD. Layering the stop beneath 1.3730 means the gains must materialize on Monday as the trade may not hold for several days. It is a fairly tough decision to make, we will decide after the market opens how we wish to proceed.

Many of GBP pairs and crosses are locked inside a tight range since the beginning of the month. We are only focusing on EURAUD, we will re-assess the market on Monday and prepare for the monthly close.

EURAUD Trade Alert

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The Weekly Update: EURUAD Technical Outlook

EURAUD Daily Chart II 26/02/17

EURAUD long at market price (1.3747)
Take profit: 1.4050
Protective stop: 1.3618
Risk Ratio (RR): 1 : 2.4 (approx.)
Estimated duration: 9 days

27/02/17 UPDATE: EURAUD is trading at 1.3792 at the time of this writing, we are closing 30% of the long trade at market price, we will shift the protective stop to the entry after the daily close as a precaution (spread widening at 22:00 GMT).

28/02/17 UPDATE: We are closing 20% of the long trade at market price (1.3820) and shift the protective stop to 1.3650.

CADJPY Entry Order

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The Weekly Update: EURUAD Technical Outlook

CADJPY Daily Chart 28/02/17

We decided not to absorb the potential retracement and opt for an entry order in CADJPY. The price has tested the lower support line as presented in our prior short trade in the cross.

CADJPY (buy limit) at 84.35
Take profit: 87.30
Protective stop: 83.60
Risk Ratio (RR): 1 : 4 (approx,)
Estimated duration: 14 days once triggered

CADJPY has 24 hours to trigger the entry order by the book but we are anticipating a short-lived spike during Trump’s speech to trigger the entry order.

01/03/17 UPDATE: CADJPY order was cancelled as the cross extended its gains without dipping lower. EURAUD triggered the protective stop that was shifted above the entry, we have ended trade with a profit.

GBPAUD Trade Alert

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The Weekly Update: EURUAD Technical Outlook

GBPAUD Monthly Chart 01/.03/17

GBPAUD long at market price (1.6010)
Take profit: 1.6440
Protective stop: 1.5830
Risk Ratio (RR): 1 : 2.3 (approx.)
Estimated duration: 21 days

Note: As this is a monthly entry we must have the ability to withstand any drawdown on the trade, hence the size of the stop. If timed correctly we should be in a comfortable position within 7 days.

02/03/17 UPDATE: GBPAUD is trading at 1.6180 at the time of this writing, we are closing 30% of the long trade at market price.

02/03/17 UPDATE II: Strong gains are often followed by a fierce retracement. Although we are in favour of a strong GBP we are realizing more partials off GBPAUD, which means the trade may very well end in the next 24 hours.

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The Weekly Update: EURUAD Technical Outlook

GBPAUD Monthly Chart 02/03/17

GBPAUD is trading at 1.6208 at the time of this writing, we are closing 40% of the long trade at market price and shift the protective stop to the entry.

02/03/17 UPDATE III: We are shifting GBPAUD protective stop to 1.6140. If the trade is not stopped out on Friday we are unlikely to roll the position over the weekend. GBPAUD is trading at 1.6198 at the time of this writing. (the protective stop was triggered, we have ended the trade with a decent profit).

GBPUSD Trade Alert

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The Weekly Update: EURUAD Technical Outlook

GBPUSD 4hr Chart 02/03/17

GBPUSD long at market price (1.2276)
Take profit: 1.2520
Protective stop: 1.2170
Risk Ratio (RR): 1 : 2.5 (approx.)
Estimated duration: 7 days

Note: This is a 4hr entry. We were looking for a lower price in order to enter, however, we are uncertain it will be provided by the market. If timed correctly the gains should begin materialize within the next 24 hours. 1.2250 is one of the key levels, the firmer support is seen around 1.2200.

07/03/17 UPDATE: GBPUSD triggered the protective stop, the recent weakness may be related to the bomb scare that is taking place in London.

The Weekly Update: EURUAD Technical Outlook

As all trades are closed this page can now be accessed by all traders. Open trades and relevant intraday strategies are restricted to members only. We have been providing trade alerts in the Forex market since May 2014.
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The Weekly Update: EURUAD Technical Outlook

Last Updated on March 26, 2017