EURAUD Bearish Flag Pattern Suggests Further Downside Ahead
The EURAUD pair is currently exhibiting a bearish flag pattern on the 4-hour chart, indicating a potential continuation of the downtrend. Price action remains confined within a secondary corrective phase, but the primary bearish trend is expected to resume soon. Traders should watch for another bearish flag formation in the upcoming sessions, reinforcing the likelihood of further declines.
Key Observations:
1. Bearish Trend Structure: The pair has been moving in a clear downtrend, with lower highs and lower lows confirming seller dominance.
2. Secondary Trend Phase: The current consolidation represents a temporary pause before the next leg down.
3. Bearish Flag Formation: The flag pattern suggests a continuation signal, with a potential downside target near 1.76400.
Trading Strategy:
- Entry: Consider short positions only after a confirmed breakdown below the flag’s support with strong bearish momentum.
- Target: The measured move projection points toward 1.76400, but partial profits can be taken along the way.
- Stop Loss: A conservative stop should be placed above the recent swing high to limit risk in case of a false breakout.
Risk Management:
- Maintain a disciplined risk-reward ratio (at least 1:2).
- Avoid aggressive entries; wait for clear confirmation (e.g., a strong bearish candle closing below support).
Conclusion:
EURAUD remains bearish, and the formation of another bearish flag reinforces the possibility of further downside. Traders should remain patient for a confirmed breakdown before entering short positions while adhering to strict risk management rules.
The EURAUD pair is currently exhibiting a bearish flag pattern on the 4-hour chart, indicating a potential continuation of the downtrend. Price action remains confined within a secondary corrective phase, but the primary bearish trend is expected to resume soon. Traders should watch for another bearish flag formation in the upcoming sessions, reinforcing the likelihood of further declines.
Key Observations:
1. Bearish Trend Structure: The pair has been moving in a clear downtrend, with lower highs and lower lows confirming seller dominance.
2. Secondary Trend Phase: The current consolidation represents a temporary pause before the next leg down.
3. Bearish Flag Formation: The flag pattern suggests a continuation signal, with a potential downside target near 1.76400.
Trading Strategy:
- Entry: Consider short positions only after a confirmed breakdown below the flag’s support with strong bearish momentum.
- Target: The measured move projection points toward 1.76400, but partial profits can be taken along the way.
- Stop Loss: A conservative stop should be placed above the recent swing high to limit risk in case of a false breakout.
Risk Management:
- Maintain a disciplined risk-reward ratio (at least 1:2).
- Avoid aggressive entries; wait for clear confirmation (e.g., a strong bearish candle closing below support).
Conclusion:
EURAUD remains bearish, and the formation of another bearish flag reinforces the possibility of further downside. Traders should remain patient for a confirmed breakdown before entering short positions while adhering to strict risk management rules.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.