EURAUD daily channel breakout, are we actually heading to 1.6490?

[Brian Carter]

Hey everyone, just looking at the charts and noticed EURAUD finally made a clean break out of that daily down channel we have been stuck in since July. It looks like wave 4 is kicking off properly after that bounce from the lows. Ngl, I am trying to figure out how to play this without getting chopped up on the retest.

If order flow really supports this push, I am curious how you guys are viewing that 1.6490 resistance level overhead. Are we expecting a sharp impulse straight into it, or do you think smart money is going to trap some breakout buyers here first before making a proper run? Wondering if anyone is scaling in long here or just waiting for a pullback to key support.

 

[Zakami Ng]

The breakout looks clean on the daily, but I'm waiting for the MACD crossover to fully commit before I size up. RSI is already creeping up near 65, so there's some room, but 1.6490 is a big ask if the momentum doesn't hold. I'd watch for a retest of the channel top first.

 

[JulianCraft]

Look, I wouldn't bet the farm on any breakout right now. With the way the Fed is dancing around interest rates and the global economy looking like it's ready to trip over its own shoelaces, I don't trust these technical setups as far as I can throw them.

@Zakami Ng, you're talking about waiting for a MACD crossover, but honestly, even if the indicators line up, the macro environment is just a dumpster fire waiting to happen. Inflation is stickier than everyone wants to admit, and once the realization hits that rates aren't dropping as fast as the bulls hope, that "clean breakout" is just going to be a massive liquidity trap. I'd be very careful chasing anything long here while the dollar and commodity currencies are reacting to such massive central bank uncertainty.

 

[Liam Walker]

Everyone is so terrified of a "liquidity trap" that they're completely missing the obvious move here. @JulianCraft, you’re talking yourself out of a perfectly good trade because you’re obsessed with the macro "dumpster fire." Newsflash: the market loves climbing a wall of worry, and while you're waiting for the Fed to hold your hand, the smart money is already milking this breakout. I’m fading the caution; 1.6490 is looking more like a floor than a ceiling at this point.

 

[LucasBennet]

[QUOTE="JulianCraft, post: 1439]Inflation is stickier than everyone wants to admit, and once the realization hits that rates aren't dropping as fast as the bulls hope[/QUOTE]

Spot on, Julian. Everyone's staring at charts and completely ignoring what's coming down the pipe with next week's CPI print. All it takes is one hot inflation number to blow right through this little channel breakout like it isn't even there. I'm staying flat until the data drops, no way I'm getting caught holding a bag when the dollar starts violently repricing the rate path again.