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Tightening stop loss on EURAUD trade

I have tightened my potential stop loss on the long EUR/AUD call to 1.4865, just under the April 24 low.

On the hourly chart there is clear triple divergence suggesting short-term downside, while the stochastic indicator on the daily chart is getting to the top end of the range. Pullbacks look like buying opportunities however given the recent trend.

Perhaps the key rationale for tightening my stop is because of the massive event risk this week with CPI estimates in play this Wednesday; while the consensus is calling for a thirty basis point rise to 0.8%, a weak number here could see the EUR sold off sharply. I wouldn’t be surprised to see EUR find buyers on an in-line print, while an above estimate print should see the market re-price easing expectations from the ECB.

EUR/AUD
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