[B]EUR/AUD FREE FALL[/B]
One of the reasons that traders come from other markets to trade the FOREX market is that currencies trend well. These trends can last months or even years. The EUR/AUD downtrend would be included in this category of long trending currencies. This pair has been in virtually a “free-fall” state from its October 2008 high of 2.1149 to its 52-week low of 1.6255. This a whopping 4,894 pips. This downtrend does not appear to be ending anytime soon especially as the Reserve Bank of Australia (RBA) has raised their benchmark interest rate to 3.25% to be the first major industrialized nation to do so. Since interest rate differentials are a key driver of currency pair price action, expect EUR/AUD and her other Aussie cousins to be bid in the coming weeks. Entering short on 2 pip break below 1.6250 or waiting for a retrace up to the 1.6750 area would be to possible scenarios where a trader could get involved.
To see my analysis of other pairs or to join in our online community to discuss trends Click HERE