need help with AUD/EUR trend

[vjeko]

I'm just starting off - have done a bit of reading,
watching webinairs and heading towards a practice
account i.e. my skills at reading the charts/trends are very basic,
so I would appreciate a hand with an immediate
"problem" I'm trying to handle (I guess I would learn a lot from this also)
- I have a sum of real money (AUD) I want to trade for EUR.
I don't need the EUR straight away i.e. I could hang on to the AUD until
I get the highset conversion rate (longer term), but would like to avoid missing
the high point due to my lack of experience (trend at the moment is
straight up)- any pointers would be appreciated

 

[cowmadagan]

Ok...the daily chart of EUR/AUD looks like this. "\"
It's not quite as steep as that, but it's a downward trend that's lasted over a year. That means the Euro is getting cheaper and cheaper to buy with your AUD.
Forget technicals for a second and look at the fundamentals. The only reason you'd want to switch AUD right now is if you were expecting another crisis, which would make switching to USD or JPY a much better bet. The Euro suffers from crisis, as does the AUD, but the Euro is also wounded on its own because of the PIIGS (Portugal, Ireland, Italy, Greece, and Spain.) The only things that would slam the AUD to the tune of crisis would be unemployment in the big economies causing a second wave of mortgage defaults, or if China's growth turned out to be all smoke and mirrors.
Conclusion: I don't really see any reason to switch to Euros, but if you have some other reason, I project that next week we'll see a slightly lower part of the cycle in EUR/AUD than right now.

 

[vjeko]

thanks -I saw the trend on the EUR/AUD chart.
Basically, I have AUD in the bank and need to repay
a loan in EUR and am waiting for the right time to
sell the AUD (I can wait even a couple of months,
but would like to avoid missing the train - the AUD
has been very low till now) - can you just give
me a pointer on what to look for to jump off the train
- at the moment I've been looking at the technical
indicator here : Dollar Euro Signals | AUD EUR Technical Analysis | Dollar Euro Technical Studies
but am not clear on how to do this a bit longer term

 

[Ricex]

Back in october 2008 1 euro would have cost you A$ 2.12, not a great investment as today that same euro is worth A$ 1.56. That's a serious fall in value and has actually been as low as A$ 1.54 recently. The last time it was that low was in the year 2000.

It has been a monumental rise for the Aussie, now at 2007 highs of 0.64, so if you go by the old adage of "buy low sell high" your pretty much in the zone for a long term investment.

Will it go lower/higher? sorry can't help on that one, but comparing the two economies at the moment you'd have to say our antipodean friends are head and shoulders above the europeans.

If you were to sell now I don't think you would see a meteoric fall as we saw before, that was exceptional, but you could perhaps reasonably target the .61 - .60 region as a first port of call.
I personally can't see for the moment why the euro would appreciate against the A$ but strange things do happen.

 

[marcus1rex]

personally i think eur/aud is one of the more difficult pairs to trade.