My previous EUR/USD signal last Monday was not triggered.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today only.
Short Trade Idea
Short entry following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.1760.
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 Idea
Long entry following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.1672.
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.
In my previous EUR/USD analysis last Monday, I thought that the EUR/USD currency pair would probably remain between $1.1805 and $1.1840 over the London session, but it could break down below $1.1800 which would be a bearish sign.
I was wrong on both, although the price has finally made a strong fall without breaking above the high of that day, so in a sense I was correct.
The price opened today with a gap down, which is unusual in Forex even after a weekend, and in recent hours has fallen very strongly. The visible cause is a souring of risk sentiment as market confront the reality of an earlier, fiercer war between the USA/Israel and Iran than was widely expected. This morning in the Middle East, each side has hit one of the other’s oil facilities, which is pushing the price of WTI Crude Oil to over 8% above last Friday’s close. This comes after the Strait of Hormuz is already effectively blocked to 70% of the 20% of global crude oil traffic which passes through that waterway.
This sentiment is also sending money flowing into the US Dollar as a safe haven, and the Euro is weaker on the same sentiment, and possibly also on Europe’s vulnerability to price hikes in crude oil.
As we have already seen a very strong drop of almost 100 pips before the London open, I think there are only two realistic trades today:
A long from a bullish bounce at the nearest support level of $1.1672.
A short from a bullish retracement which fails at the resistance level of $1.1760. I would prefer this setup to the long one.
Any news of escalatory attacks on oil facilities will be likely to cause the price to make sharp drops.
There is nothing scheduled today concerning the Euro. Regarding the US Dollar, there will be a release of ISM Manufacturing PMI data in the USA at 3pm London time.
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