EUR/USD Forex Signal - 3 January 2019

Yesterday’s signals were not triggered, as there was no bullish price action at 1.1429.

Today’s EUR/USD Signals

Risk 0.75%.

Trades must be taken before 5pm London time today only.

Short Trade

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1422.

  • 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 Trade

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 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 market’s dominant “risk-off” mode was boosting the Euro, but 1.1500 may prevent much more of a further advance for the time being, so be careful. This was a good call as the high of the day was made just under 1.1500 and the price has fallen very heavily from that area, reaching all the way down to the support at 1.1306, from where it has recovered over the past few hours. Despite the strong downwards movement, which had nothing to do with the earlier “flash crash” in the Japanese Yen, the price is really consolidating within a range over this 1.13 to 1.15 area, so we are likely to see the price continue to move slowly between key support and resistance levels. As such, I have no directional bias on this currency pair today.

EURUSD

There is nothing of high importance due today concerning the EUR. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.

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.