Today’s analysis is a continuation of yesterday’s. The assumption to enter a short position was fulfilled. The price for the second time came under resistance around 1,5700 and here there was a downward rebound. However, before we open the short, let’s discuss the situation on the chart a bit.
EURAUD from the end of June was in a quite wide consolidation between 1,5700 and 1,5850. It was not until 3 August that there was a dynamic breakout thru the bottom. At the end of last week, there was a retest of the broken recently support, which proved to be a new resistance. Another retest has just finished, so we have the opportunity to enter the position again.
We have two goals for Take Profit. The area around 1.5465 seems to be better, where there is another significant support. This position will give a very high profit / risk ratio. More conservative investors can aim for the area around the last lows, which is somewhere in the vicinity of 1.5580. Even in this case, you will still have a possibility to earn over 100 pips.