My previous EUR/USD signal on 22nd January was not triggered as there was insufficiently bullish price action when the support level at $1.0888 was first reached that day.
Today’s EUR/USD Signals
- Risk 0.75%.
- Trades may only be taken between 8am and 5pm London time today.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.0876, $1.0914, or $1.0932.
- Place the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.0848, $1.0822, or $1.0815.
- Place the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
EUR/USD Analysis
In my previous analysis of the EUR/USD currency pair two days ago, I wrote that the price would probably not move much today, giving little trading opportunities except perhaps for scalpers.
The only larger opportunity I saw which might set up could be if the price gets established later above the resistance level at $1.0932 as it would then have room to rise to the $1.1000 area. This was a good and accurate call – the break above $1.0932 did not set up.
The technical picture is now a little more bearish, as we have seen a breakdown below the former supportive area at $1.0900, and the price is still trading below that round number.
However, we also have a bullish development – the sharp “V” seen in the price chart below from the support level at $1.0822 shows there has been strong buying, and we are seeing short-term bullish momentum.
At the time of writing, bulls are knocking on the resistance level at $1.0876 and this looks likely to be the level which will determine what will happen today. Therefore, I will take a long trade if we get two consecutive hourly closes above it before the end of today’s London session, although I would not expect this to be a very profitable trade.
Regarding the EUR there will be a release of French Manufacturing & Services PMI data at 8:15am London time followed by German data 15 minutes later. Concerning the USD, there will be releases of Flash Services & Manufacturing PMI data at 2:45pm.
Ready to trade our daily Forex signals? Here is a list of the best Forex brokers worth reviewing.