Price on the daily chart of the EURAUD has broken through a key resistance level and closed above, signalling that price may have finally flipped from rejecting this level as a resistance to now looking to holding as a new support. As long as price continues to hold above this new support level, traders can continue to look for it to hold as a new support level.
Price has now formed an inside bar (IB) above this support level. This could be a pause before price continues on higher into the next near tern support level. The key for any quick move higher is going to be the new short term support level holding. If the support fails and price breaks through, then the key level would once again look to act as resistance.
If price can break through the high of the housing candle it may be able to move higher and into the near term resistance around 1.4615. For price to have any chance of moving higher it will have to break the high of the housing candle. To learn more about the inside bar read here: Trading Price Action with the Inside Bar
EURAUD DAILY CHART
Thanks Johnathon for this excellent article. I still have 1 thing that I don't understand. How did you choose your resistance level in this article. Sorry for my rubbish question if it is.