Yesterday’s signals produced a profitable short trade following the bearish inside candle rejecting the resistance level at 1.1295. This could be the start of a long-term bearish movement, but the price has reached an area would it may find support, so it could make sense to take partial profits.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may be taken before 5pm London time today only.
Long Trade 1
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1163.
- Put the stop loss 1 pip below the local swing low.
- Adjust 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.
Short Trade 1
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1295.
- Put the stop loss 1 pip above the local swing high.
- Adjust 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
The supportive trend line held throughout the session yesterday, with the price rising strongly following poorer than expected U.S. economic data, topping at the multi-month high of 1.1295, before falling sharply upon the FOMC release and interest rate hike. The level at 1.1295, as it is a multi-month inflective high, is significant, and the rejection there may signify the beginning of a bearish trend, although the price is still technically within a bullish trend. It is important now to watch whether the price holds up above the supportive trend lines and 1.1163, as a fast break below these could trigger a sharp fall. Alternatively, if they hold we are more likely to see the price test 1.1295 again soon. The price is in a long-term pivotal area
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There is nothing due today concerning the EUR. Regarding the USD, there will be a release of Unemployment Claims data at 1:30pm London time.