EUR/USD – Another Retracement After Large Move Lower
EUR/USD has spent most of today retracing after the large drop which we saw take place yesterday.
Yesterday’s drop created a new lower low which tells us the momentum is still to the downside. In order for this momentum to change we need to see the high of the move down get broken by a new high. We need to keep a close watch on the market to see if it continues to the upside or if it fall back and starts moving lower once again.
Keep an eye on the lows at the bottom of this retracement, if this retracement has been caused by the banks placing buy trades to make the price reverse they may want to get more of their buy trades placed when the price returns to these lows.
USD/JPY – Price Falling Into The Retracement Low
After coming very close to breaking the low of the retracement yesterday morning, the price of USD/JPY rose up, but has since fallen lower and is now getting closer and closer to the low of the retracement.
This current drop into the retracement low is stronger than the previous drop as evidenced by the fact that the bearish candles which make up the drop are all large range candles which contain very little buying. I think it’s likely this drop will break the low of the retracement and we’ll see a much bigger move lower take place over the coming days.
For now I think it’s best if we wait for the low to be broken before attempting to go short.
AUD/USD – Price Moving Out Of Daily Demand Zone
Yesterday we saw the price retrace higher after a big move down had taken place, I said in my post how it would be worth watching the lows of this retracement just in case it was caused by the banks placing buy trades into the market.
Late last night the price fell into the lows of this retracement and began moving higher. If we look at the 30 minute chart we can see how a large bullish engulfing candle appeared when market fell into the lows. This would have been our signal to place a buy trade if we were present in the market at the time this occurred.
The move higher from this low has managed to break the previous swing high in the market which means for now the momentum is to the upside and we only want to be looking to get long trades placed. On the daily chart we can see that currently today’s candle is a bullish engulfing, which means it’s likely for the market to continue moving higher tomorrow.