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No fresh ideas for new plays at the moment, so here are quick updates on my longer-term plays on EUR/USD and AUD/USD.

Support Break on EUR/USD

EUR/USD Daily
EUR/USD Daily Forex Chart

Two weeks ago I shorted EUR/USD after it broke below a rising lows pattern to play my fundamental bias in favor of the Greenback over the euro. That turned to be a fake out thanks to a bearish USD move sparked by a Wall Street Journal article speculating the end of the Federal Reserve’s bond portfolio runoff.

The pair made its way back up to the 1.1500 handle with the help of a dovish FOMC statement, but topped out there. Now weak European data seems to be the main driver for the latest push lower, nearly retesting the 1.1300 handle. So, it looks like I missed my opportunity to add to the position at a better price, but I’m not going to kick myself too much because USD weakness was strongly supported at the time.

My next move will be to add to my position if 1.1400 gets retested or if the rising highs is broken once again. The latter is the likelier scenario if European worries continues to rise, but I’ll be ready to move if either scenario plays out.

AUD/USD Long-Term Downtrend?

AUD/USD Daily Forex Chart
AUD/USD Daily Forex Chart

I first shorted AUD/USD with my first position at the beginning of January, as mentioned above, the Greenback had a rough run since then, pushing AUD/USD higher to nearly retest the 0.7300 handle. Unfortunately, it was short of my second short order at 0.7335, so I didn’t get a chance to get a bigger benefit from the recent pounding that the AUD/USD took after dovish comments from the RBA governor Philip Lowe on the potential for interest rate cuts sent the Aussie lower across the board.

Thanks to that event, I’m back in profit on this trade by around 100 pips, but it’s another missed opportunity to get into my full position at a better price. And since I think that event was a game changer for the Aussie, I don’t think we’ll see that level again for a while; so I decided to cancel my short orders at 0.7335. 

Instead I’ll be watching for a break of the major support area around 0.7050 to add to my position, and only if the driving themes still favor the the downtrend (e.g., weak Aussie data, no progress with the U.S.-China trade negotiations, etc.).

So stay tuned for potential adjustments to both my EUR/USD and AUD/USD trade…and as always, good luck and good trading!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.