EUR/USD: Key support at 1.1826
Last Thursday’s signals were not triggered as there was no bearish price action at any of the resistance levels which were reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken prior to 5 pm London time today only.
Short Trade Ideas
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1881 or 1.1929.
- 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
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1826, 1.1790, or 1.1745.
- 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, just after the bullish V-shaped bounce at 1.1745, that there was no reason to assume that 1.1745 would break down today, so the next technical clue was likely to come when we saw the price hit one of the resistance levels identified above.
This was a good call as we saw the first level get broken quite easily and quickly, which accurately foretold the continuing rise in the price.
Recent hours have seen the price fail to rise much higher as it has got close to the next resistance level at 1.1881. However, the nearest support level at 1.1826 looks strong, and we still have a valid long-term bullish trend in force, so we may see an opportunity to go long later if we get a bounce if and when 1.1826 is reached.
I am prepared to take a long trade following a bullish bounce at 1.1826 if it happens today, though it looks likely to be a quiet day in the market.
There is nothing of high importance scheduled today regarding the EUR. Concerning the USD, the Chair of the Federal Reserve will be giving a minor speech at 3 pm London time.