Going long EURUSD, Staying Short AUDUSD

By DailyFx | October 08, 2012 AAA

I remain short the Australian Dollar against the US Dollar, but I'm looking to buy this EURUSD dip as I don't think the currency pair trades below its 200-day Simple Moving Average.

I first went short AUDUSD from two weeks ago from the $1.0430 mark and have trailed my stop to above the $1.0270 mark.

With the EURUSD position I like going against the most recent decline. As per my forex strategy outlook this week , I think the EURUSD looks most attractive as a range trade. RSI remains heavily oversold on intraday charts, and that's good signal in my opinion.

I like a EURUSD long position as long as it remains above its late September low and 200-day SMA at $1.2800. Profit targets start at intraday reaction highs of 1.2960 and the $1.3000 mark. A minimum 1:1 reward to risk implies that the position remains valid at $1.2880 or lower.

I remain long USDJPY though I can't say I fully recommend joining me here: the pair seems incapable of holding gains. That said, USDJPY position remains in force as long as the pair trades above ¥76. Profit targets start at ¥80 on the USDJPY.

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

To receive the Speculative Sentiment Index and other reports from this author via e-mail, send a message with subject line "Distribution List" to drodriguez@dailyfx.com;

Contact David via

Twitter at http://www.twitter.com/DRodriguezFX

Facebook at http://www.Facebook.com/DRodriguezFX

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

You May Also Like

Related Forex Analysis
  1. Investing

    Why Gold is not Rallying

  2. Investing

    EUR/USD: 2015 Forex Forecast

  3. Investing

    GBP/CHF: 2015 Forex Forecast

  4. Investing

    USD/CAD: 2015 Forex Forecast

  5. Investing

    USD/JPY: 2015 Forex Forecast

Trading Center