EUR AUD Revisited for 2nd Swing Short; 4th July 2013

EUR AUD Revisited for 2nd Swing Short; 4th July 2013

Having closed the previous EUR:AUD swing short for a quick profit the time has come to take another look whilst price continues to struggle against Daily resistance.

The MACD negative divergence has now confirmed itself and price breaks above the 1.4270 level appear to attract selling pressure. I was so close to entering short last night but at that time price was above 1.4270 and looking lively so the decision was made to wait until today. Price did drift lower overnight and my entry wasn’t at the best possible levels but it turned out to be good enough.

Here’s the 15 minute chart from which the short entry was made at 1.4237 just as price failed to find support from the green 200 MA:

EUR AUD 15 min 4th July 2013

The trade was opened with a 200 point stop loss well above the existing high and I’m yet to lower this following today’s fairly low volume price action. The main sell off that occurred today was following signals given by the ECB that it would continue to loosen monetary policy, which is quite the opposite to signals given by the FED in the U.S.

Although there’s still a possibility today’s sell off will be recovered and the trade stopped out, the Daily chart shows a better picture of resistance at the 1.4270 level alongside negative MACD divergence which formed at the price highs:

EUR AUD Daily 4th July 2013

Although at 200 points the risk on this trade isn’t small, I believe the potential reward from a sell off to the mid level of the 2 Year trading range at 1.29 makes this a trade well worth taking the risk for. Although if you know me you’ll know I’ll probably close the trade well before such levels are seen!

5 Comments
  • This Week's Swing Trading Round-Up; 7th July 2013
    Posted at 22:58h, 07 July

    […] quiet Week with the only trade taken being a re-entry of a previous set-up on EUR:AUD. Since Thursday’s sell off price has recovered a fair bit so it is now my intention to lower […]

  • RS2OOO
    Posted at 18:53h, 09 July

    Closed half of this EUR:AUD swing short at 1.3916 which is the 23.6% fib level for a profit of 321 pips.

    This is taken with the view a topping process will be a longer term affair and a re-entry of this portion of the trade at better levels should become available.

  • This Week's Swing Trading Round-Up; 21st July 2013
    Posted at 23:12h, 21 July

    […] low volumes and little going on in the markets things still remain quiet. The 2nd half of the EUR:AUD short is still running and went into the Weekend showing a loss of around 70 pips. I’m […]

  • RS2OOO
    Posted at 21:21h, 25 July

    The 2nd half of the EUR AUD swing short was stopped out for a loss of -180 pips.

    Based on the 321 points profit taken on the first half, this gives an aggregate overall profit of +141 points on the trade.

  • This Week's Swing Trading Round-Up; 28th July 2013
    Posted at 00:19h, 29 July

    […] 2nd half of the EUR:AUD swing short was closed for a loss of -180 pips. Taking into account the +321 points taken on the […]