Trade Watchlist: EUR/AUD Countertrend Play at Channel Top

National Financial Solution > Forex Trading > Trade Watchlist: EUR/AUD Countertrend Play at Channel Top

I’m seeing a long-term uptrend on EUR/AUD, but there could be an opportunity for a countertrend play with the upcoming catalysts.

Do you think the channel resistance will hold?

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

This pair is closing in on the top of its rising channel on the 4-hour chart, and a bounce could take it back to nearby support levels.

I’m holding out for the upcoming Australian jobs report, though, as a weak read might spur an upside breakout. After all, the expiry of the JobSeeker stimulus program likely resulted in hiring losses for April.

Then again, Aussie traders might have already priced in this outcome and could simply book profits during the actual release. Besides, there could be room for stronger than expected results that could spur a relief rally for AUD.

Meanwhile, the euro could take cues from the flash PMI readings due later in the week. The forecasts are looking mixed, though, with the manufacturing sector likely to post improvements and the services industry to see some dips in activity.

Technical indicators for EUR/AUD are also looking mixed on this 4-hour chart, with the 100 SMA above the 200 SMA and Stochastic closing in on the overbought zone.

In any case, I’ll be keeping a close eye on the 1.5700 handle to see if resistance might hold during these top-tier news events. Are you looking to trade this pair, too?

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.

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