Trend, Trend Exhaustion And The Shifting Ground

There are times when keeping an eye on the markets is as exciting as watching paint dry. Then, there are times when great leaps literally happen faster than you can blink. You be the judge as to whether the former or the latter better applies to the euro and Australian dollar right now.

EUR/USD – Trend Emerging

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Yesterday, EUR/USD extended losses and closed the day below the blue support zone, making our short positions even more profitable (our subscribers were prepared in advance and we opened the shorts in close vicinity of the blue support zone on Monday). Today, the bearish momentum continues and at the moment of writing these words, the pair is trading at around 1.1385.

This increases the probability of the bearish scenario coming true. How low can the euro fall in the coming days? Retesting the lower border of the brown triangle would come first,likely to be followed by the green support zone that has stopped the sellers several times in recent weeks.

USD/CHF – Resistance vs. the Trend

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On Tuesday, currency bulls managed to take USD/CHF to a fresh 2019 peak, which produced a tiny breakout above the upper border of the yellow resistance zone. The bullish sentiment proved short-lived as evidenced by the long upper knot, and the pair closed inside the yellow resistance zone. This invalidation of the earlier tiny breakout doesn’t bode well for higher values of the exchange rate in the coming days.

However, as long as there are no sell signals generated by the daily indicators, one more attempt to move higher can’t be ruled out. It could test the 76.4% or 78.6% Fibonacci retracements and even reach the blue dashed line (that would be the upper border of the potential blue rising wedge).

AUD/USD – Like a Hot Knife through Butter

(Click on image to enlarge)

(Click on image to enlarge)

On Monday, we wrote:

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