This week, EURAUD (Euro/Australian Dollar) has entered a critical price zone, providing a textbook technical opportunity for traders. A clear Head & Shoulders pattern has formed on the 4-hour chart, pointing toward a potential trend reversal from bullish to bearish.
Let’s explore how to trade this intelligently from both bullish and bearish perspectives.
1. Bearish Setup – Head & Shoulders Pattern Breakdown
This is the primary trade idea for the week.
✅ Trade Logic:
🔻 Entry Plan:
📉 Stop Loss:
Place SL above the right shoulder high, adjusting for volatility and swing high (around 1.7950).
🎯 Targets:
2. Alternative Bullish Setup – Reversal at Neckline (High Risk)
This setup is for experienced or aggressive traders who spot early reversals.
✅ Trade Logic:
🔺 Entry Plan:
Wait for bullish confirmation (reversal candle) near the neckline and EMA support (around 1.7700).
🚨 Stop Loss:
SL must be below the neckline swing low (around 1.7650).
🎯 Targets:
⚠️ This is considered a counter-trend trade and should be traded with caution.
3. Technical Confluence and Indicators
4. Final Thoughts
This week’s EURAUD setup is a strong example of structure-based trading. With a well-formed head and shoulders pattern and a clean neckline break, the market signals a shift in momentum.
Safe Approach: Trade the short side after resistance rejection.
Risky Approach: Try a long on neckline bounce with tight SL.
Always confirm with your system and maintain strict risk management. Trade what you see, not what you feel.
Ready to trade? Save this setup, monitor price action, and execute only with confirmation.
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Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
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Let’s explore how to trade this intelligently from both bullish and bearish perspectives.
1. Bearish Setup – Head & Shoulders Pattern Breakdown
This is the primary trade idea for the week.
✅ Trade Logic:
- Price has completed a classic Left Shoulder → Head → Right Shoulder formation.
- The neckline (support) will be tested.
- The current price is will pulling back to retest the right shoulder resistance zone, offering an ideal short opportunity.
🔻 Entry Plan:
- Wait for bearish reversal confirmation (candlestick rejection or bearish engulfing) on the 1H or 4H timeframe.
- Enter short once confirmation appears near 1.7850–1.7900.
📉 Stop Loss:
Place SL above the right shoulder high, adjusting for volatility and swing high (around 1.7950).
🎯 Targets:
- Target zone: 1.7450–1.7500 (profit booking zone marked on the chart)
- Potential Risk/Reward Ratio: 1:2, 1:3, or even 1:4+
2. Alternative Bullish Setup – Reversal at Neckline (High Risk)
This setup is for experienced or aggressive traders who spot early reversals.
✅ Trade Logic:
- Price may bounce from the neckline and 200 EMA support area.
- If this happens, a temporary bullish reversal may push price back toward the right shoulder zone.
🔺 Entry Plan:
Wait for bullish confirmation (reversal candle) near the neckline and EMA support (around 1.7700).
🚨 Stop Loss:
SL must be below the neckline swing low (around 1.7650).
🎯 Targets:
- Resistance zone (right shoulder): 1.7850–1.7900
- R:R setups of 1:2 or 1:3 possible
⚠️ This is considered a counter-trend trade and should be traded with caution.
3. Technical Confluence and Indicators
- Pattern: Head & Shoulders (bearish reversal)
- EMA 200: Price reacting around the long-term trend line
- Support/Resistance: Cleanly defined horizontal zones
- Reversal zones: Highlighted in red (supply) and green (demand)
4. Final Thoughts
This week’s EURAUD setup is a strong example of structure-based trading. With a well-formed head and shoulders pattern and a clean neckline break, the market signals a shift in momentum.
Safe Approach: Trade the short side after resistance rejection.
Risky Approach: Try a long on neckline bounce with tight SL.
Always confirm with your system and maintain strict risk management. Trade what you see, not what you feel.
Ready to trade? Save this setup, monitor price action, and execute only with confirmation.
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Disclosure: I am part of Trade Nation's Influencer program and receive a monthly fee for using their TradingView charts in my analysis.
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Note
14/07/2025 - Market Updates-Currently consolidating in narrow range.
- Price is rejecting downside near 200EMA on 4 Hr Timeframe
*Waiting to price reach at neckline of head and Shoulder
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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.
📈 Trade Smarter with TradZoo!
🔗 Website: bit.ly/tradzoopage
📣 Telegram: t.me/tradzooIndex
📲 Android App: bit.ly/TradZooApp
📲 Forex App:tradzoo.com/forex/download
🍎 iOS App: bit.ly/TradZoo-iOS-App
🔗 Website: bit.ly/tradzoopage
📣 Telegram: t.me/tradzooIndex
📲 Android App: bit.ly/TradZooApp
📲 Forex App:tradzoo.com/forex/download
🍎 iOS App: bit.ly/TradZoo-iOS-App
Related publications
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.