EUR/USD Forex Signal - 4 February 2019

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Last Thursday’s signals were not triggered as there was no bullish price action at either of the support levels.

Today’s EUR/USD Signals

Risk 0.75%.

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

Short Trades

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1477.

  • 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

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1435, 1.1394 or 1.1378.

  • 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 last Thursday that both sentiment and technical factors favoured the bulls, so I would take a bullish bias on this pair if the price made higher highs at 9am London time. This was a good call as the price had already begun to fall by then, and essentially continued to move down over the day, so it was enough to stay out of trouble. The area above 1.1500 has also acted as long-term resistance so it wasn’t very surprising that the price was ultimately unable to hold up there.

The U.S. Dollar is advancing almost everywhere and the slight but real strength here is the major story in the Forex market right now. This suggests lower prices, however there is a support level close by at 1.1435 which might hold.

The resistance level at 1.1477 looks attractive as it is currently perfectly confluent with a short-term bearish trend line shown in the price chart below.

Price direction looks relatively uncertain in this pair today. so I take no directional bias.EURUSDThere is nothing of high importance due today regarding either the EUR or the USD.

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.