How to Trade the Current EURUSD Trend

How to Trade the Current EURUSD Trend

Unlike retail or day traders, large funds or “real money” traders do not have the luxury of being able to turn positions quickly. While I am not privy to how they trade, especially since each follow its own strategy, logic says that they focus more on longer term than shorter term charts.

For this reason, I pay attention to what longer term charts show even though I do not trade in those time frames. I am most interested in any levels that would change the trend or technical picture,

This is part of The Amazing Trader (AT) approach, which starts with longer-term charts to identify the broader trend/risk and then drills down to short-term charts looking for AT patterns to trade. As I have said many times, identifying the side to trade Is more than half the battle in executing successful trades.

Trading the Current EURUSD Trend

This brings us to the current trend in the EURUSD, which is down but consolidating. Without going into the finer details, let’s start by looking at the longer-term charts.

DAILY EURUSD CHART

A break of 1.0935 would be needed to end the downtrend. This level is too far away to be relevant so we drill down to the next time frame, the 4 hour chart.

4 HOUR EURUSD CHART

How to Trade the Current EURUSD Trend

The key level on this chart Is 1.0663. AT logic says to treat any up move that stalls shy of this level a retracement.

On the downside, the key level is the 1.0496 low as this the only level that should matter to longer-term players. .

So, the broad range is 1.0496-1.0663, with limited follow through unless either side Is taken out. Some might call it consolidation. I call it using AT logic where the broader viesw is that the downside is more at risk unlsess 1.0663  is taksn out.

If 1.0496 is broken then the ey level on top becomes 1.0610. replacing 1.0663.

Why are these the key levels?

It is all explained in the AT Trading Guide given to subscribers but if you follow the premise that the FOREX market is driven by a never ending quest to run stops, .you will see why these are the key level that matter.

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