Trading the EURUSD right now is a mistake, and here is why

euro

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.

That simple!

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:

EURUSD Analysis

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:

AUDCAD Analysis

AUDCAD Analysis

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.

CHFJPY Analysis

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).

CHFJPY Analysis

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.

Your turn

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?

Please comment.

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Raul Lopez

I've been trading the markets for more than 15 years. I believe the best way to trade is by adapting to the market conditions. You can learn it too, join our community .

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  • 2face

    Como estas Raul? Nice tip from you buddy

    • Raul Lopez

      I’m glad you found it useful…

      Cheers,

  • Eviano

    so are you still waiting for the CHFJPY according to what you said yesterday. or you are trading now already?

  • Waqas Khan

    what about NZDUSD tell me quickly please what could be the bear target?

    • Raul Lopez

      I wouldnt suggest you to trade the NZDUSD… its too crowded… also very close to the next LT support level.

      If you do trade it, good luck Waqas!

      • Waqas Khan

        what about now? price action suggesting me to go long. i am taking this risk.

  • Satish Dasi

    Hello Raul, I was only trading with USD/GBP/AUD pairs, but I took your advice and looked at the other charts. I traded the NZD/USD today and made a small profit. Thats a great tip Raul, keep it up.

    • Raul Lopez

      That’s great Satish! congrats!

  • Eviano

    Lopez, take a look at GBPJPY. I am seeing almost 1000 pips following the breakout today. what do you think?

    • Raul Lopez

      There is a pretty strong resistance level in the GBPJPY at 179.82

  • aneel

    hey raul, Please don’t mind, there is a mistake in AUD/CAD Chart. The chart you are showing is 1Week Chart Not daily chart. Moreover, your analysis are good and most of time in trading I follow you and watch your article.

    • Raul Lopez

      Actually its the daily chart, but its zoomed out! For that reason it looks like the weekly chart!

      Thanks and good luck!

  • tp

    Hi,

    I traded the USDJPY, GBPJPY and EURUSD this week. This week has been okay for FX traders. I’m up 1.5% this week.

    • Raul Lopez

      Wow… congrats TP! what does TP stand for?

  • Eviano

    Please, clarify this opinion which I have read in different places. “once there is a break out, the market will first of all return to the new support level before it will continue with it new direction. e.g the breakout in the chfjpy, the market will return to the old resistance zone under 1hour chat before it will start going up

    • Raul Lopez

      Hello Eviano, sometimes it retraces back and sometimes it doesnt… Sometimes they are false breakouts and sometimes they arent false breakouts…

      There is no golden rule, you just need a well defined methodology that will allow you to take only the breakouts that have a higher chance of success…

      Good luck!

  • Eviano

    You can also take a look at AUDUSD. I believe it is in a bearish condition

    • Raul Lopez

      Yep, looks like it…

  • Waqas Khan

    chfjpy broke that level. i am going long. Mr Raul tell is this the right time or not ?

    • Raul Lopez

      Not yet for me…

      • Waqas Khan

        that was the right time. i took 90 pips in my favor

        • Raul Lopez

          Congrats Waqas!

  • Eviano

    I so much agree with you on EURUSD. But beyond AUDCAD and CHFJPY, which other once did you see because for the past two weeks it has been difficult for me to identify direction on the daily chat.

    • Raul Lopez

      Ufff, there are plenty of others :)

  • waqas

    i agreed 100%

    • Raul Lopez

      Way to go…