The EURAUD pair is forming a descending triangle in an uptrend.

Sometimes these trades break down, providing a steady risk reward trading opportunity.

Be mindful of the recent uptrend, but do notice the daily chart is showing overbought and follows a doji star candlestick pattern from the 10th of May, indicating a possible reversal trade idea.

EURAUD short - Descending triangle

Ethereum has been hit hard recently, along with all the cryptos, including Bitcoin falling 26% from the 5th of May to yesterday's low.

Ethereum is down 52% in 129 days, but it has landed on a key support level and there is a possibility for a short bounce from here.

While the range potential is up to $3200, this trade is looking for a smaller target of just $2659, with the stop below the recent swing low.

The risk reward on this trade is not huge and it is in the face of a strong downtrend, so be mindful of that.

ETHEREUM long reversal trade 1.49RR

The British Pound has lost 1300 pips in 57 days. An incredible drop as the flight to US dollar continues. The moves on the way down have been massive, wtih 761 pips coming off in just 10 days.

This has put the GBPUSD firmly in oversold territory but we must be mindful that a market can remain oversold for much longer than we can remain solvent (as the saying goes).

This reversal trade is looking for a short term bounce from here with a clear stop loss level, as trying to fade these trends can be fruitful, but equally frustratingly difficult.

Be mindful that the dominant trend is well and truly down and if this chart moves lower, then this trade is off or an exit. For those new to trading, best watching this trade idea from the sidelines.

GBPUSD reversal trade 1.56 RR

The Dax index has been consistently hitting lower highs and lower lows on the dialy and 4-hourly chart, and when viewing the stochastic oscillator, we can see some bullish divergence.

Yesterdays candle formation was a piercing line pattern, closing above the mid point of the previous days bearish candle, highlighting the potential for a further bullish move higher.

This combo provides an opportunity for a short term buy with a tight stop and sensible take profit level.

This is a reversal trade, which is going against a clear dominant downtrend, so if it doesn't move higher, then this trade idea will get stopped out. You can see how fast the Dax moves lower when it starts trending, so be sure to get out quick if this move up doesn't unfold.

Ger30 long bullish divergence trade

The US Dollar has been incredibly strong, rising over 1500 pips against the Yen since the start of March. The daily chart is showing some consolidation at the current levels and this is filtering down to the hourly chart as well.

Having said that, this is a reversal trade idea, going against the dominant trend, so be mindful of that.

The recent hights have been getting lower, but each small pullback has been met with buying support.

Having said that, I'm looking for a 100 pip possible downside with my stop loss above the recent high. 

I have plotted the yellow zone to indicate a level of resistance and if I were looking for a tighter stop, my exit would be just above that yellow zone.

USDJPY short during this consolidation

We can see bearish divergence building on the USDCAD pair from Friday's push higher, only to be sold off intraday today.

This trade is looking for the potential of a pull back down to the recent support level around 1.2643 but given the sideways nature of the current pricing, it could fall below that and ultimately back below 1.2600.

There is a lot of support around the 1.2500 level, so a bigger potential move could see it hit those levels. Trading involves risk.

USDCAD bearish divergence heading back below support?

On the daily chart, the GBPAUD is showing bearish divergence and is coming off overbought territoty and now popping its head back below resistance. Support doesn't seem to be holding at these levels.

This is a short opportunity to look for potential downside if momentum can gather speed from the recent highs around 1.7887.

GBPAUD bearish divergence on daily chart

On a daily chart, the EURNZD is sitting overbought and at the top of the range. It has the potential to pull back to the recent congestion level around 1. 6000.

This is a short trade looking to capture a small pull back if the momentum continues lower.

On the hourly chart, the stop is just above the recent highs. The risk reward isn't amazing, so we'll watching this one to see if it continues to pull back.

Short EURNZD

Back on the 28th-31st of March, the US dollar gave back a small portion of the incredible gains it had made from 115 to nearly 125 (10 big figures).

This USDJPY reversal trade is looking for a similar setup, in that the run up has been incredible again and has the potential for traders to think the USD is overbought at the current levels.

This trade is against the dominant trend, so a strict stop loss must be used. And the profit target is reasonably small, at around 100 pips. The risk reward is around 1:1, so not a big R multiple win potential here.

Nevertheless, if you feel the USDJPY is overbought and are looking for a possible short trade setup, this could be worth looking at. Not recommended for newbie traders.

USDJPY short, looking for overbought retracement

Looking across the top 50 stocks on the ASX, we have a higher number of stocks that are heading south, and of those that are hitting new short-term highs, they are either on resistance or showing bearish divergence.

You can also see the bearish divergence on the AU200 chart on the stochastic. Divergence is always a powerful indicator at picking tops or bottoms, but must be used with caution.

Therefore, this setup is to take advantage of what appears to be investors unable to find 'value' in buying new stocks at the relative highs we are seeing right now.

As you can imagine, the resistance shown on the chart could be broken, leading to a breakout opportunity and a stop loss for this trade.

The Risk Reward on this trade is worth looking at, and given it is a mean reversion style strategy, trade with a smaller position size to what you might usually trade.

AU200 Overbought & on resistance - Potential downside

Bill Ackman recently bought 3.1m shares of Netflix, becoming a top 20 shareholder. They are slightly underwater at this level but unlikely to panic sell. They believe the Netflix dream and will continue to hold.

We could see weakness down as low as $270, shaking out the weak hands, but if would be silly to think that the Netflix engineers cannot update their code to counter the crazy amount of account sharing.

Even just a password reset to mess up all the non paying users.

You'd have to think Netflix is here to stay and with over 214 million paying subscribers, you'd think this short term sell off will become a bargain soon.

I don't like to buy massive sell-offs, but I'll share this as a trading idea. Remember to be cautious on this as selling could continue in the short term.

Netflix's 214 million PAID subscribers to save the day

The CAC 40 lost 1500 points in just 45 days, which culminated on the 7th of March, only to then be bought up aggressively from 5751 to above the 6800 level. 

This goes to show the short-term support for the CAC40, and this bullish trade is looking to take advantage of the recent pull-back, to see support from here with the potential for a move higher.

Ashley Jessen

Ashley Jessen

May 11 2022

EURAUD short - Descending triangle

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Ashley Jessen

May 11 2022

ETHEREUM long reversal trade 1.49RR

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Ashley Jessen

May 11 2022

GBPUSD reversal trade 1.56 RR

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Ashley Jessen

May 10 2022

Ger30 long bullish divergence trade

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Ashley Jessen

May 10 2022

USDJPY short during this consolidation

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Ashley Jessen

Apr 26 2022

USDCAD bearish divergence heading back below support?

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Ashley Jessen

Apr 26 2022

GBPAUD bearish divergence on daily chart

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Ashley Jessen

Apr 26 2022

Short EURNZD

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Ashley Jessen

Apr 20 2022

USDJPY short, looking for overbought retracement

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Ashley Jessen

Apr 20 2022

AU200 Overbought & on resistance - Potential downside

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Ashley Jessen

Apr 20 2022

Netflix's 214 million PAID subscribers to save the day

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Ashley Jessen

Apr 20 2022

Bullish CAC40 trade idea

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