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Ugh, faked out! I thought I saw enough bullish momentum to classify as an upside break, but the pair still made another test of the triangle support. Here’s what happened:

Long EUR/AUD Idea

It looks like the political troubles in the euro zone weren’t over as the Catalan situation continued to weigh on the shared currency while the Austrian elections brought in a fresh batch of uncertainties. Not even strong medium-tier reports were enough support the euro!

I set my buy order past the triangle resistance on the 4-hour time frame and the 1.5200 mark, thinking it would be enough to confirm an upside break. However, price quickly turned around and made a beeline back to the triangle support.

EUR/AUD 4-hour Forex Chart
EUR/AUD 4-hour Forex Chart

My long-term bullish view on this pair remains intact, though, as price is still hovering around the mid-channel area of interest visible on the daily and weekly charts.

In hindsight, I probably should’ve set a much wider stop for this pair way below the triangle support to give it more breathing room. I guess I just thought that the 1.5000 major psychological mark would be enough to keep losses at bay!

As for the Aussie, well, let’s just say I’m not the biggest fan of this currency but it looks like market sentiment has been turning in its favor these days. Traders appear to be bracing for upbeat data from China later this week while easing concerns over North Korea also supported risk-taking.

Anyway, here’s the damage:

P/L: -250 pips / -0.50%

As you can probably tell, I’m a bit bummed out about getting kicked out of this long position quickly, especially since I’m maintaining a bullish EUR bias on ECB tapering expectations. Think I should hop back in or look for a different pair instead?

Cheers,

Happy

See also: Q3 2017 Trading Performance Review

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