My previous EUR/USD signal on 9th January was not triggered, as the resistance level I had identified at $1.0692 did not hold strongly enough to produce a short trade signal.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be taken before 5pm London time today.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.0937, $1.0956, or $1.0985.
- 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 50 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 timeframe immediately upon the next touch of $1.0864 or $1.0766.
- 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
In my previous analysis of the EUR/USD currency pair on 9th January, I thought that the $1.0700 area was likely to be pivotal that day. I was looking for long trades.
This was a good call, as the day was a strong up day, and once the price broke up past $1.0700 it continued to rise during that day’s London session for another 60 pips.
The technical picture continues to be bullish, with the price action having printed higher support levels over recent days, while bulls managed to push the price to a new 9-month high above $1.0900 during Monday’s Asian session.
However, the past few hours at the time of writing have seen a bearish retracement begin to develop.
Due to the long-term bullish trend, we should expect the most likely scenario to be the price rising again later and possibly attempting to break above the key resistance level at $1.0937. I am not very hopeful the price will reach much higher than that as we have another resistance level just a bit higher than that at $1.0956 which will probably also exert some downwards pressure.
The best opportunity we might see today will likely be a bearish retracement to the nearest support level at $1.0864. If that price is touched and we see a firm bullish bounce, that would signal a long trade entry off support within a strong upwards trend, which is very attractive in a currency pair such as this one which has tended to trend reliably.
There is nothing of high importance due today concerning either the EUR or the USD.
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