Hi Traders! EURAUD forecast and technical analysis is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the daily chart here.
You can watch the video explanation of this idea here
EURAUD D1(Daily) Chart Analysis – Range, Bearish Divergence, Key Resistance Zone, Stochastic Oscillator
On the daily chart the price is moving inside a range which started on 25th February 2021. This range is formed by the highs and lows reaching parallel support and resistance zones. The price which is moving inside this range has currently reached the top of it. The price has also created a bearish divergence between the first high that has formed on 3rd June 2021 and the second high that has formed on 22nd June 2021 which we may consider as evidence of bearish pressure. We also have a strong resistance zone which coincides with the top of this range, thus making this area a key resistance zone for us. Until this key resistance zone holds my view remains bearish here. Also, based on the Stochastic Oscillator we could see that the price has reached its extreme we may consider this as yet another evidence of bearish pressure. So everything looks good here for the bears and we may now move down to lower timeframe and look for evidences supporting this bearish view.
EURAUD H1(1 Hour) Chart Analysis – Bearish Convergence, Strong Resistance Zone
On the H1 chart we have a bearish divergence that has formed between the first high that has formed at 1.58271 and the second high that has formed at 1.58598 based on the MACD indicator. The price then moved lower and broke below the last low at 1.58132 thus forming a classical setup of bearish divergence followed by bearish convergence, we may consider this as evidence of bearish pressure. As per the book scenario after a bearish convergence we may expect corrections and then further continuation lower. Currently it looks like a correction is happening. So based on all this my view here is bearish and until the strong resistance zone shown in the image below (marked in blue) holds I expect the price to move lower further in the short term.
Technical Analysis & Forecast Summary
EURAUD D1(Daily) Chart Analysis
- Range, Bearish Divergence, Key Resistance Zone, Stochastic Oscillator
EURAUD H1(1 Hour) Chart Analysis
- Bearish Convergence, Strong Resistance Zone
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
