EURUSD: Strong recovery from 1.1030
Last Thursday’s signals were likely to have produced a very profitable long trade from the bullish rejection of the support level at 1.1030. It could be wise to hold onto this trade for a while longer as the price is still acting as if it will rise further.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered before 5pm London time today.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1188 or 1.1199.
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 Trade Ideas
Go long following a bullish price action reversal immediately upon the next touch of 1.1117 or 1.1030.
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.
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 last Thursday that the price had already got very close to the nearest key support level at 1.1030, which would almost certainly be the day’s pivotal point.
I was ready to take a bearish bias if the price was below 1.1025 at 9am or 10am London time. This was a very good call as 1.1030 was indeed the pivotal point of the day, and the price failing to close below 1.1025 for a few hours did indicate that the price would rise.
The rise has been surprisingly strong, so it seems there was long-term buying at this long-term low, but the real driver of this movement is probably the hit the U.S. Dollar is taking as the U.S./China trade dispute worsens with adverse measures being taken by both parties over the past few days. Money is flowing into safe havens and the Euro sometimes acts as such, so in this type of environment we tend to see the Yen, Gold, and the Euro doing well.
Technically, the new higher support at 1.1117 is a bullish sign. This level is likely to be today’s pivotal point, so if it holds up, we are likely to see another rise today, possibly even as high as the resistance level at 1.1188.
If the price closes above 1.1150 at 9am or 10am London time today, I would take a bullish bias on this currency pair.
There is nothing of high importance due today concerning the EUR. Regarding the USD, there will be a release of ISM Non-Manufacturing PMI data at 3pm London time.