Looks like euro bulls are out to play now that the ECB refrained from adding stimulus! What adjustments should I make with these euro positions?
This pair popped higher after the downbeat BOE Inflation Report hearings and then during the ECB statement and presser, surging past the descending channel but still finding resistance at the 61.8% Fib… so far.
Stochastic is pointing down to suggest that sellers are about to regain control of price action, possibly pushing the pair back down to the previous lows at .8335. The pair is also testing the top WATR for this week anyway, adding to the strength of the .8500 area as a ceiling.
However, I’m a bit concerned about this upside break from the channel resistance so I’m considering cutting my losses at this point. It’s not going to be too much of a dent on my account since I only risked 0.25% on this short position and I’ve got a wide stop past .8600. What do you guys think?
As for this long EUR/AUD position, I’m gonna give myself a pat on the back for holding my ground and not panicking when price was testing the 1.4600 mark. You see, I was too early with my entry on this one since I thought the pair was already breaking past the double bottom neckline when it was just in the middle of forming an inverse head and shoulders instead.
The recent ECB decision could keep the shared currency supported, probably enough to take it back up to the neckline resistance and give me a chance to decide whether I should hold on or exit at a better price. It also seems as though risk appetite has taken a hit from the ECB announcement so the Aussie could cough up its recent gains.
Got any tips on how I should manage these open positions? I seem to recall some of y’all watching the daily rising channel support on EUR/GBP that seems to have held so far. Think the euro is in for a longer-term climb from here?
As always, don’t risk more than 1% of your account on a single trade and make sure you read our risk disclosure if you’re thinking of taking the same setups.