Yesterday’s EUR/USD signal was not triggered as there was no bearish price action when the price first reached the support levels identified at $1.1387 or $1.1352.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today only.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.1352 or $1.1387.
- 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 $1.1317, $1.1261, $1.1250, $1.1229.
- 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 yesterday that as we had no major data releases today to disturb the dominant consolidation pattern, we would be likely to see the price consolidate over the day between $1.1387 and $1.1435 or maybe $1.1451. However, I thought that traders should be cautious around the New York open as there may be volatility due to the US return from holiday.
This was not a good call as the price broke down below the support at $1.1387 even before the New York open, and kept falling all day, reaching the next support level at $1.1317 where it may have made a bullish reversal.
Yesterday’s Forex market was driven by a strengthening US dollar on rising US Treasury yields. This seems to be reversing over recent hours, so the EUR/USD maybe has some scope to rise over the short-term, which is supported by the bullish short-term price action rebounding from the support at $1.1317. However, there looks to be key resistance close overhead at $1.1352 which could halt much further advance.
Both the closest support and resistance levels to the current price look likely to hold, so I again have no bias on today’s direction. I think the best approach will be to scalp from any bounces at a key level, if the level looks like it is being rejected by the price.
There is nothing of high importance due today concerning either the EUR or the USD.