EUR/AUD Strategy: A Top in Place Above 1.51 Figure?
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- EUR/AUD Strategy: Short at 1.5021
- Euro may have topped at 11-month highs above 1.51 vs. Aussie
- Short position activated, targeting a test below the 1.49 figure
The Euro may be carving out a top against the Australian Dollar, with negative RSI divergence pointing to ebbing upside momentum after prices rose to an 11-month high. The latest surge higher was mirrored by a drop in German 10-year bonds, hinting at ebbing political risk after the French election as the catalyst.
With market favorite Emmanuel Macron now at the helm and polls suggesting Chancellor Angela Merkel is on pace to secure another term when Germany decides on its leadership later this year, monetary policy may retake the spotlight for the Euro. A firmly dovish ECB makes this a potentially damaging proposition.
A short EUR/AUD position has been activated at 1.5021. The trade initially targets 1.4838 and carries a stop-loss to be activated on a daily close above 1.5112. Profit on half of open exposure will be taken and the stop-loss moved to breakeven when (and if) the first objective is met.
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