Hi Traders! EURAUD short term forecast update and follow up is here. On April 11th 2023 I shared this “EURAUD Technical Analysis And Short Term Forecast” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club. Spoiler alert – free memberships are available!
My Idea
On the H1 chart, the price which is moving higher has created a bearish divergence here as well that has formed between the first high formed at 1.63876 and the second high formed at 1.63928 based on the MACD indicator which we may consider as evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal here at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads a value over 25 which we may consider as another evidence of bearish pressure. Also, in addition to this, currently there are no signs opposing this short term bearish view. So everything looks good here for the bears here as well and until the key resistance zone (marked in red) shown in the image below holds my short-term view remains bearish here and I expect the price to move lower further.
EURAUD H1(1 Hour) Chart Current Scenario
Based on the above-mentioned analysis, on the H1 chart, my short-term view was bearish here and I was expecting the price to move lower further until the key resistance zone holds. The price action followed my analysis exactly as I expected it to here. The price moved higher, reached the key resistance zone again, respected it and then it bounced lower from this zone delivering 210+ pips move!
On the M15 chart, the market provided us with various facts supporting the bearish view. The price, which was moving higher, created a bearish divergence between the first high, formed at 1.64375 and the second high, formed at 1.64460 based on the MACD indicator. The price then moved lower and broke below the most recent uptrend line. We may consider these as facts provided by the market supporting the bearish view, and also there were no signs opposing this bearish view. Then as you can see in the image below, the price moved lower further after that and provided a fantastic move to the downside!
So, traders, this is why I wanted to show this example to help you understand how important it is to follow the facts. The facts were supporting the bearish view here, and there were no signs against it. When the facts do happen as we expected, you can see how the price perfectly moved as per the plan. Because these are the kind of hints the market provides us with the majority of the time, it’s our obligation as traders to be able to listen to these things that the market tells us, and we should try to make the right actions accordingly.
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Happy Trading!
Arvinth Akash
Home Trader Club Team.
