EUR/USD Forex Signal: Strongly Bullish

Adam Lemon

EUR/USD: Euro one of the main gainers from USD weakness

Yesterday’s signals were not triggered, as there was no bearish price action when the resistance levels were reached.

Today’s EUR/USD Signals

Risk 0.75%.

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

Short Trade Ideas

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.0971 or 1.1056.

  • Place 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.

  • Take off 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 Ideas

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.0923 or 1.0887.

  • Place 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.

  • Take off 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.

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EUR/USD Analysis

I wrote yesterday that the consolidation pattern had become slightly bullish, and I thought the price may break suddenly above 1.0836 and rise quite quickly to the next resistance level at 1.0887 over the day. That was a good call as the price reached and quite quickly exceeded 1.0887, although I was wrong about looking primarily for short trades and expecting that the day would not be very active in this pair. It was a strong mover on what would typically be a quiet Monday.

Yesterday’s market was driven by a strong boost in risk-on sentiment which had the effect of weakening the U.S. Dollar and boosting almost every other currency, especially the Euro, as stock markets also gained. This saw the price power up cleanly beyond two former resistance levels.

The break above 1.0887 was technically significant.

There is still a long-term bearish trend in this pair, but we seem to be getting near a point where that trend is going to be invalidated.

We seem to be set for more bullish price movement today as the price is now trading firmly above the new higher support level at 1.0923. I would take a long trade today from a bullish bounce following a retracement to 1.0923, or a short trade from a strong bearish reversal at 1.1056.EURUSDThere is nothing of high importance due today concerning the EUR. Regarding the USD, the Chair of the Federal Reserve will be testifying before the Senate at 3pm London time.

About the Author
Adam Lemon

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.
Learn more from Adam in his free lessons at FX Academy

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