Yesterday’s signals produced a profitable short trade following the bearish engulfing candlestick reversal at the resistance level identified at 1.1400. It gave a maximum of about 29 pips profit and looks uncertain if you still have any of it running.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today only.
Short Trades
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1400 or 1.1445.
Put the stop loss 1 pip above the local swing high.
Adjust 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 run.
Long Trades
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1334 or 1.1306
Put the stop loss 1 pip above the local swing high.
Adjust 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 run.
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
I wrote yesterday that the picture looked more bearish now, with the price having broken support before re-establishing it, but we can now see in the price chart shown below a clearer sequence of lower swing highs. I took a very weak bearish bias, but I wanted to see another failure to rise close to 1.1400 before being prepared to enter any short trade.
This was a good call as the primary movement of the day was downwards, and the move originated at 1.1400 as I had anticipated.
However, the picture now looks more bullish, with the Euro attracting safe haven flows and the Dollar weakening. The short-term price action suggests there will shortly be another attempt at the resistance level of 1.1400 which is likely to be pivotal today. It will probably be broken, and I will take a weakly bullish bias if the price can trade above 1.1400 for two hours, until the end of the London session. The FOMC releases sue after that might push the price anywhere.
There is nothing important due today concerning the EUR. Regarding the USD, there will be a release of the FOMC Economic Projections, Statement, and Federal Funds Rate at 7pm London time followed by the usual press conference half an hour later.