EUR/USD: Medium-term wide bullish price channel
Yesterday’s signals were not triggered, as the bearish price action took place above 1.0961.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered prior to 5pm London time today.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1056.
Put 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.
Remove 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 on the H1 time frame immediately upon the next touch of 1.0954, 1.0915, or 1.0870.
Put 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.
Remove 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 was ready to take a short trade from any strong bearish reversal which happened anywhere between 1.0961 and 1.1056. This did not set up with sufficiently strong bearish price action until after London closed, but I was on the right track, and a bearish reversal took place just below 1.1000.
Despite the bearish reversal, the picture is looking very bullish technically, with the price rebounding from new support just above 1.0950, which had previously been an area of strong resistance. This, coupled with the medium-term ascending symmetrical price channel shown in the price chart below, is a bullish sign, suggesting that we are going to see higher prices today.
Although the price is likely to rise over the course of today, we are still liable to see resistance at the big round number of 1.1000 so a strong bearish reversal there is a possibility. I would be careful remaining in a long trade when 1.1000 is reached. However, I am happy to take a long trade from a bullish bounce at 1.0954.
There is nothing of high importance due today concerning either the EUR or the USD.