Last Thursday’s signals were not triggered as there was no bearish price action at any of the key resistance levels which were reached that day.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today only.
Short Trade Idea
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2187.
Place 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 1.2107 or 1.2060.
Place 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 we had key resistance levels at 1.2087 and 1.2100 but also a support level close by at 1.2058 which looked strong. I was ready to take a short trade, but I also noted that we had a potentially tight range plus likely volatility around the ECB release.
In the end, the price has continued to range, but more bullishly as new higher support above 1.2100 is printed. There is a long-term bullish trend, and the euro is being boosted right now by the fact that the E.U. and U.K. set aside yesterday’s deadline for a final Brexit trade deal, with talks now ongoing. Both parties indicate a deal remains unlikely, but of course they want to reduce expectations as a bargaining tool.
I will take a long trade today if we get a firm bounce at any of the identified support levels, but I will not take a real bullish bias unless and until we see a daily (New York) close above the bearish inflection points at about 1.2160. The price is most likely to continue ranging today and although it is a quiet Monday, the euro and pound are likely to be quite active in the market.
There is nothing of high importance scheduled for today regarding either the EUR or the USD.