EUR/USD Forex Signal - 31 January 2019

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Yesterday’s signals were not triggered as none of the levels were reached during the London session.

Today’s EUR/USD Signal

Risk 0.75%.

Trades may only be taken between 8am and 5pm London time today.

Short Trades

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1540 or 1.1572.
  • 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.
  • Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.

Long Trades

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1479 or 1.1455.
  • 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.
  • Take off 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

I wrote yesterday that I would take a bullish bias after the FOMC release if the price rose then to trade above 1.1455 after being below it. This scenario did occur, and it was a good call as the price at the time of writing is about 30 pips higher than it was an hour or so after the FOMC release.

The price is now trading quite bullishly above former resistance levels and also above the psychological level at 1.1500. These are bullish signs and we have enough of a bullish trend to put the odds in favour of higher prices still today. However, the resistance above at 1.1540 marks an area which the price has struggled to break for some time now. Despite that, both sentiment and technical factors favour the bulls, so I would take a bullish bias on this pair today if the price makes higher highs one at 9am London time.

EURUSD

There is nothing of high importance due today regarding either the EUR or the USD.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment.
Learn more from Adam in his free lessons at FX Academy.