EUR/USD: New 18-month high price
Last Thursday’s signals were not triggered as the bearish reversal at the resistance level identified at 1.1625 did not happen until after the London close.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken prior to 5 pm 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 1.1779 or 1.1829.
- 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 1.1685 or 1.1624.
- Place the stop loss 1 pip below the local swing low.
- 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.
EUR/USD Analysis
I wrote last Thursday that the situation continued to look bullish, with new higher support at 1.1565 and the price rising firmly over the short term.
I thought that we were likely to see another test of the high made earlier at the round number at 1.1600.
I was very happy to take a bullish bias, looking for trades from bounces at support following retracements.
This was a good call as the price continued to rise over the day and is now considerably higher still, although none of the support levels identified were reached. However, I did suggest scalpers could buy any dips profitably and this would have worked well.
The price has continued to advance and has even risen quite strongly during the first Asian session of this week, hitting new 18-month high prices above 1.1700.
Approaching the London session, the short-term price action looks bullish, suggesting we will advance to new highs today.
There is no obvious resistance level 1.1779 although the big psychological quarter-number at 1.1750 may provide some resistance.
The USD is very weak on falling yields and a rising coronavirus toll on the health and economy of the U.S.A. while the Eurozone economy looks poised to begin an earlier recovery. The ECB’s actions have also boosted the Euro.
We are seeing strong price movements and they are worth taking advantage of.
I will take a bullish bias today to 1.1779 as soon as we get an hourly close above 1.1725.
There is nothing of high importance due today regarding either the EUR or the USD.