Yesterday’s signals were not triggered as none of the key levels identified were reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered before 5pm London time today.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2260, 1.2300, or 1.2310.
Put 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 Idea
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2107.
Put 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 yesterday that despite several bullish factors, the price remained well within a consolidative zone until it broke above 1.2260, so a short trade from a reversal at that level remained a valid potential trade.
This was an OK call, as although the price has risen a little over the past 24 hours, it has not quite been able to reach the resistance level I have identified at 1.2260.
Although the price broke bullishly out of the narrowing triangle pattern which I identified within last year’s price chart, the break has not been decisive, and it is possible to redraw the triangle’s upper trend line as still containing the price, as I have within the below price chart.
This leaves the technical picture essentially unchanged. We are still seeing a medium-term consolidation within a wide range between 1.2260 and 1.2106. Furthermore, there are more resistance levels above 1.2260 representing a congested zone which the price is quite likely to struggle to break through. On the other hand, there is a long-term bullish trend, and the price is close to long-term highs and looking somewhat bullish, so a bullish breakout beyond 1.2260 would not be a surprise.
I will take a bullish bias if we get a daily New York close above 1.2268, but I am also ready to take a short trade from a firm bearish reversal if one sets up rejecting 1.2260 later.
There is nothing of high importance scheduled today regarding either the EUR or the USD.