Last week’s Wednesday EUR/USD signal was not triggered as there was no bearish price action when the price first reached the resistance level identified at $1.1303.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today.
Short Trade Idea
Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.1394.
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.
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 timeframe immediately upon the next touch of $1.1315 or $1.1261.
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.
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 Wednesday last week that the technical picture was still very consolidative but a little bearish. I thought that the price was quite likely to remain between $1.1250 and $1.1302 over the course of the day with uncertain direction, so I thought that scalping any reversal from either of the aforementioned key levels and monitoring on short timeframes would be the best approach to trade this pair over the day.
Although the US Dollar is showing strength and this currency pair remains in a valid long-term bearish trend, bulls seem to have the advantage right now, with the price refusing to make any truly significant lows over recent days. We have continued to see buying below $1.1300. It looks like we have a new support level at $1.1315 and the price is very close to that at the time of writing. Therefore, if we get a bullish bounce here early in today’s London session, this could produce a good long trade entry signal.
With $1.1315 looking like a pivotal point, it could be logical to go short if the price breaks below this level. However, I think this would be dangerous. If you are taking this course, it would make more sense to wait for a bearish breakdown and then a retest of $1.1315 from below. If there is then a bearish reversal at the first retest, it would be safer to enter a short trade.
It is not likely that the price will reach the nearest resistance level at $1.1394 today, but if it does, that would probably provide a great short trade entry opportunity.
There is nothing of high importance scheduled today regarding either the EUR or the USD.