Daily Briefing, Feb 18 – Trading the EUR/USD & AUD/USD on US President’s Day
Arslan Butt • 2 min read
Good morning, traders.
The dollar was significantly weaker on Friday, as growing expectations of a US-Sino trade deal drove investors to shift away from the safe haven Greenback into riskier assets. It’s been a phenomenal closing of the week with a number of winning trading signals in NZD/JPY, Gold, AUD/USD, and GBP/JPY.
Today, the US banks will be closed in observance of President’s Day. Now I’m serving up EUR/USD and AUD/USD to secure high probability trades. So, are you ready to secure some profit?
Top Trade Setups Today
EUR/USD – Sideways Channel in Play
EUR/USD has formed a sideways channel with an upper range at $1.1345 – $1.1250. On 4-hour chart, the pair has formed a candlestick “bullish engulfing” pattern which is strengthening the bullish trend of the EUR/USD.
The pair also had a bullish cross over on 20 periods EMA, signaling bullish bias of investors. The 20 periods EMA is likely to provide support at around $1.1280. In between this range, the pair is likely to find support at 38.2% Fibonacci retracement level of $1.1280/85.
EUR/USD – Technical Levels
Key Trading Level: 1.1289
German Buba Monthly Report – The Bundesbank is due to cover this report at 11:00 (GMT). It contains relevant articles, speeches, statistical tables, and provides a detailed analysis of current and future economic conditions from the bank’s viewpoint. Typically, this report has a muted impact on the market.
EUR/USD Trade Plan
The idea is to stay bearish below $1.1340 with a stop loss above $1.1360 and take profit of $1.1270 and $1.1520.
AUD/USD – Pair in Bullish Channel
The Aussie enjoyed a more peaceful trade last week, with bullish movement seen in AUD/USD compared to the previous one. The pair placed a high around $0.7160 to enter the overbought region.
Lately, the AUD/USD has formed a Doji pattern below $0.7160, making it a strong resistance level.
The relative strength index and stochastics are in overbought range, indicating a potential retracement in the pair. The pair may drop towards $0.7130 today.
AUD/USD – Technical Levels
Key Trading Level: 0.7114
AUD/USD Trade Plan
As per the technical analysis, it’s worth taking a sell position below $0.7150 with a 25 pips stop and 35 pips take profit today.
Fellas, the market may exhibit thin trading volume and volatility today as the US markets will remain closed in the observance of President’s Day. Good luck!