EUR/USD Signal Update
Yesterday’s signals expired without being triggered, as the price did not reach either 1.3715 or 1.3955 during yesterday’s London session.
Today’s EUR/USD Signals
Risk 0.75%.
Entries must be made before 5pm London time.
Short Trade 1
Short entry after a next bar break of any bullish pin or engulfing hourly candle after a first touch of 1.3955. Following one hour from the close of the first hourly candle that closes above 1.3955, this trade should not be taken.
Put a stop loss 1 pip above the local swing high.
Move the stop loss to break even at 1.3925. Take 50% of the position as profit and leave the remainder to ride.
Short Trade 2
Short entry after a next bar break of any bullish pin or engulfing hourly candle after a first touch of 1.3975. Following one hour from the close of the first hourly candle that closes above 1.3975, this trade should not be taken.
Put a stop loss 1 pip above the local swing high.
Move the stop loss to break even at 1.3925. Take 50% of the position as profit and leave the remainder to ride.
EUR/USD Analysis
Things look very bullish now. Yesterday saw a strong move up following the pair’s retest and rejection of the broken bearish trend line at around 1.3830. We have also had a fairly strong move upwards earlier this morning during the late Tokyo session.
At the time of writing, the price is sitting on the underside of a long-term ascending trend line that has been established for more than a year. The trend line is currently placed at around 1.3933. I am not sure if it will hold but it could be a factor.
We are too far away from any obvious levels looking like good buying opportunities. The nearest level looks to be 1.3715. However we are very close to some likely resistant levels at 1.3955 and 1.3975, as well as the trend line I previously mentioned. The 1.3955 level is exactly confluent with the 50% Fibonacci retracement level of the major downwards from the pair’s all time high to a multi-year low made in 2010, as well as today’s R2 GMT daily pivot point, so this level really ought to have a resistant effect.
Therefore in spite of the very bullish price action and major bullish trend line breakout, I am happy to look for shorts off 1.3955 and/or 1.3975, but as we are very close to these levels I need to see it confirmed by bearish price action first.
A candlestick analysis shows bullishness on all of the higher time frames and we are still within a widening bullish channel.
There are no important data releases scheduled today concerning the EUR. However there are three high-impact data releases concerning the USD that will occur simultaneously at 12:30pm London time: Core Retail Sales, Retail Sales, and Unemployment Claims. This is likely to mean that things will be quiet until around Noon London time when this pair should get more active.