Monthly Overview

We start at the monthly chart, to note sideways movement from 2014, we are currently in a range 1.385 area to 1.60. With important support and resistance zone of 1.371.

In November 2017 we broke 1.5535 and had a monthly close above but we fell back in December, price then produced a doji with virtually the same open/close on a monthly candle.

We mention this because, we had another doji in April 2018 and have fallen back to 1.5535, still an important support and resistance level and after this months fall we are at that level again. 

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Weekly Overview

The weekly chart shows the fall outside the channel with 4 negative weeks and the support level of 1.5535, next support will be 1.5229.

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Daily Overview

The daily chart shows last weeks trade idea and the double top and the fall past the confirmation line to the trendline and our first target, then the break and fall to our second target. Now we have reached there, we will see if 1.5535 will break.

We note that price today has tried to push lower but has rejected nearly off the 200-day moving average, but is still above the support level. This may indicate a small bounce to come. 

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4 Hour Overview

The 4-hour chart now becomes of interest as we build our picture with the fall to a support level of 1.5535 we see a massive rejection candle a Hammer, with a very long wick. But a hammer on its own is a very week signal so we need a close above 1.5550, to help confirm we may see a bounce here into the 1.5587/1.56 area.

If not a break of 1.5535 may see a move to the low of the hammer. 

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Trade Idea

We will be looking for a buy trade on the EURAUD. We will be trading a move above a high.

We need a 4 hour close above to confirm as the pattern is not that strong on its own.  We will have an appropriate trade size for our account!

Our entry will be ideally around 1.5550 area (if the close has moved to high this will invalidate, due to the risk/reward and the targets being to close)

Our trade will be invalidated with a 4 hour close below 1.5535. Our stop loss will be 30 pips from entry. Our target will be 1.5587/1.56.