EUR/USD Forex Signal: Mildly Bullish

Adam Lemon

Area at 1.1859 looks pivotal.

Last Thursday’s signals were not triggered, as there was no bearish price action when the resistance level identified at 1.1783 was first reached.

Today’s EUR/USD Signals

Risk 0.75%.

Trades must be entered between 8am and 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 1.1859 or 1.1929.

  • 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 1.1834, 1.1815, 1.1789, or 1.1745.

  • Put 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.

  • 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 last Thursday that the technical picture had become more bearish but there was also new higher support creating a mixed picture overall. I thought that if the price could get established below 1.1745 that would be a bearish sign and if it could get established above 1.1783 that would be a bullish sign.

This was a very good call as the price quickly broke up above 1.1783 and has been rising ever since.

The technical picture now is a little more bullish as the price has risen slowly but steadily. There is a broad risk-on rally going on in the markets following the U.S. presidential election results and this has caused a general weakening of the U.S. dollar across the board, providing some trading opportunities in the Forex markets. However, the euro is not particularly strong as it is not seen as such a “risk” currency anymore – currencies such as the Australian dollar have tended to gain more strongly against the greenback over recent days.

Short-term price action at the time of writing is suggesting that the rally may be running out of steam, with the nearby area of resistance at 1.1859 looking quite strong naturally. I see this area (not a precise level) as highly likely to be today’s pivotal point, with a short trade looking like the most obvious potential set-up. However, support at 1.1843 nearby also looks likely to be strong, so there may not be much downside there.EUR/USDThere is nothing of high importance due today concerning either the EUR or the USD.

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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