Trading the EURUSD right now is a mistake, and here is why
If you have been following me for a while you know that the first thing I do in the morning, before I place any trade is to look at the long term charts.
Not because I like to trade off the daily or the weekly charts, but because when the market swings on the long term charts make sense, you are most likely to see a move in the same direction on the short term charts.
So it’s not because I don’t like the EURUSD, but because right now, I dont see a clear condition.
I don’t know about you, but for me right now, the EURUSD doesn’t make any sense.
What does it mean?
That I have absolutely no idea of what the EURUSD is likely to do, or what direction to trade it and until when.
And when I dont have the answer to all those three questions, I just forget about that currency pair (for the day) and focus in others with clearer conditions…
Let me just show you the EURUSD daily chart:
You see what I’m talking about? No clear swings, no clear S&R levels… You see every time it gets rejected from different (random) levels…
So please… dont trade it!
You may say…
Hey Raul, the EURUSD is the one with the lowest spread…
I know it’s got the lowest spread available, but what would you rather trade:
A currency pair with a lower spread but you have absolutely no idea of what it is likely to do (lower chance of success)
Or a currency pair with a larger spread but you know what it is likely to go (higher chance of success)
What do you think?
Hey Raul, I’ve never traded another currency pair than the EURUSD…
My friend, right now would be a good time to reach new horizons don’t you think?
So please try other crosses.
Hey Raul, what other pairs should I trade if I don’t trade the EURUSD?
I thought that was coming…
So here are a couple I’m currently watching:
The AUDCAD is trading in a very clear bearish condition, as you can see it was clearly rejected from an important resistance level (at the parity) and now it is likely to continue its way down until it reaches the next LT support level around 0.9195.
It’s got about 500 pips before we get there, so we got plenty of room to find a short opportunity.
I’m closely watching this one, because if it manages to confirm and break through the short term resistance level, we’ll be trading a historical highs (from what I can see on my platform).
Now, I’m talking about a breakout of the resistance level because it’s closer to that level, but if it goes down and breaks the support level (and keeps trading below that level – 109.02), that would trigger a bearish condition, and short opportunities will be in play.
As you can see, there are other opportunities, these are just two of them…
So please, trade only the ones with a clear market condition.
What do you think about the EURUSD? Are you trading it?
What other pairs or crosses are you trading?
Do you agree with my analysis on the CHFJPY and AUDCAD?