The currency pair EUR / AUD is one of the most important "euro crosses", ie currency pairs with the euro, in global FX trading, even if the liquidity is not quite as low as in EUR / USD or USD / JPY. The Eurozone is the largest supranational currency group in the world, the Australian dollar is one of the commodity currencies due to the significant commodity exports from "down under"
Investors can bet on an appreciation of the euro against the "Aussie Dollar" by trading long EUR AUD. A short position can be used to trade the opposite scenario in the euro Australian dollar: a devaluation of the common currency in favor of the down under currency.
- Shows less liquidity than EUR / USD or USD / JPY on
- in the major group
- a popular Euro cross pair
- no common main trading hours for the Asia session and Sydney session
- counts as " Risk without interest "currency
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EUR / AUD with Forex: expiration of a currency transaction
investors who have a long position euro Trading the Australian dollar and thus betting on an appreciation of the euro can carry out two transactions with a click of the mouse. In the first step, a loan is taken out in AUD. In the second (implemented at the same time) step, the borrowed liquidity is exchanged for EUR. In simple terms, a long position in EUR / AUD consists of a money market account in AUD and a credit money market account in EUR. If the calculation works, an appreciation of the EUR after opening the long position leads to a relative devaluation of the liabilities denominated in AUD. If the position is then closed, the entire EUR balance does not have to be used to fully repay the AUD liabilities: the difference is the profit generated by the investor.
When trading with For the EUR / AUD currency pair, the trader receives an AUD money market account held in debit and a EUR money market account held in credit.
EUR / AUD exchange rate in quantity and price quotation
If the exchange rate is shown in the form EUR / AUD (EUR is shown on the left), the EUR is the base currency of the exchange pair. In the format of the quantity listing, the market value then expresses how many units AUD are paid on the market for 1.00 EUR. Conversely, in the format of the price quotation (the reciprocal of the quantity quotation), the price indicates how many units EUR 1.00 for AUD 1.00 are currently traded on the market. The Euro Australian dollar exchange rate is most often quoted in the form of the quantity quotation.
When trading with the currency pair EUR / AUD, the quantity quotation is most likely to be encountered. Closely followed by the price quotation. The price quotation is the reciprocal of the quantity quotation.
Forex Technical Analysis: EUR.AUD
What is Euro Crosses?
Euro Crosses are the currency pairs on which the euro currency is directly involved. If the euro exchange rate develops well, the Euro Crosses are currency pairs that should also be included in the current trading decision in order to achieve good trading profits. Basically, the following applies: The developments of the individual Euro Crosses allow the development trends of other Euro Crosses to currency pairs with the participation of Japanese yen, American dollar or British pound to be better estimated.
An extract from the Euro Crosses:
- EUR / USD
- EUR / GBP
- EUR / JPY
- EUR / AUD
- EUR / CHF
In order to obtain a complete overview of the possible market-wide development, it is not only the consideration and analysis of the currency pair EUR / AUD that plays a role. The tracking and inclusion of exchange rate developments in the euro cross currencies is just as crucial.
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Which Forex strategies are suitable for the currency pair EUR / AUD?
Risk-taking Forex traders choose a mini future long strategy for the currency pair EUR / AUD. The trader assumes that the EUR / AUD exchange rate will increase over time. This strategy primarily depends on the placement of the stop-loss barrier and the stop price. Decision-relevant data can be determined from the generally free charts and market analyzes of the online brokers or fee-based analysis data. As further strategies, especially Forex beginners can rely on the trend-following strategy and the contra-trend strategy. The trading decision should always be preceded by a good risk assessment, good trading conditions and the use of current market data. In the event of sideways movements, forex beginners can rely on trend strategy or the point of a trend reversal.
The IMF, the International Monetary Fund's assessment, offers a very good way of analyzing current charts and market data as well as the forecast economic developments in Australia to understand and evaluate. Depending on the tendency of the signals, such as unemployment or commodity prices, the investment amount and the Forex trading strategy should be chosen. Other important sources for making trading decisions can be found, for example, from the Australian Statistical Authority with regard to information on unemployment.
The Mini Future Long and the trend following strategies are a common Forex strategy. Strategy.
Experience with the EUR / AUD currency pair
Was the Australian dollar via the Bretton Woods Agreement, 1966, to the American Tied to the dollar, there is no longer any link to the US dollar today. No measures to regulate the AUD exchange rate have been taken by Australia since 1983. The Australian dollar, which is traded at a free exchange rate, is one of the most commonly traded currencies. He is also a member of the major group.
If the Australian dollar is compared with the euro or the Swiss franc, the strong fluctuations in the exchange rate of the Australian dollar become clear.
Trading beginners the EUR / AUD currency pair should trade in extremely narrow spreads and at low trading costs. Trading can take place during the Sydney session from 10 p.m. to 7 a.m. GMT and in the London session from 8 a.m. to 5 p.m. GMT. There is no overlap between the two trading sessions.
These signals influence the volatility of the Australian dollar:
- Unemployment rate
- Economic situation in exporting countries such as India, China, USA or Japan
- Commodity prices
- Difference between the interest rate and the inflation rate
Source: IG Markets trading platform, EUR / AUD on a weekly basis, December 2014 Trading in the EUR / AUD currency pair proves to be risky. Fluctuations are not uncommon with this currency pair, so that risk-taking Forex traders in particular get their money's worth. Traders who are betting on an appreciation of the euro should also include this currency pair in their trading decisions when considering the amount of EUR crosses. The direct independence from the key interest rate US dollar has proven to be an advantage here.
Conclusion: Forecasts and chart analyzes are essential
The evaluation of charts and analyzes is essential. Online brokers such as IG Markets or Plus500 (Plus500 experiences) offer free charts. Depending on the type of trader, up-to-the-minute market data should be integrated into the trading platform or via app on the iPhone or smartphone. So traders can trade immediately as soon as prices change, trends and other strategy patterns emerge or good trading recommendations are available via social trading. Trading is always associated with risk. Traders can lose their invested capital.
As Australia's economic growth has increased steadily since 1992, the Australian dollar is often traded among optimistic traders as a strong and stable currency for the more crisis-prone euro. If it looks like a decline in the euro exchange rate, the Australian dollar should be bought accordingly. EUR / AUD with Forex is recommended for experienced Forex traders. Beginners should familiarize themselves with the market observation of the Euro Australian dollar market for the time being. The currency pair formerly known as "interest without risk" has now developed into a currency pair with risk without interest.
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