EUR/USD and AUD/USD: Low risk entry point

Today, we had a highly volatile trading day in the Forex and Equities markets. Volatility is the norm in all markets, but today was extraordinarily volatile.

The market always does what it was going to do, regardless of what comes out on the news. More often that not, what comes out in the news is well known information. For example, the fact that Trump was planning on firing Powell is not new news. But there was a panic.

This panic, however, seems to have created a trading opportunity for us. It’s never a good idea to try and time a volatile market. Always wait for things to settle before you make a move.

The charts below show a low risk, high probability trade in EUR/USD and AUD/USD, which are at present trading in a channel, what could turn into a bull flag based on longer term historical context.

Here’s the trade outlined. What one could do to enter this trade is to buy at market with a stop loss below the channel indicated. Worst case scenario, you get out with a 1% loss or whatever your risk profile is. However, based on the longer term pattern, there could be a significant upside.

Pictures speaks more than a thousand words.