Yesterday’s signals produced a long trade from a bullish engulfing candlestick rejecting the support level identified at 1.2301, and it gave about 40 pips of profit in total.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm London time today only..
Short Trades
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2301 or 1.2340.
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 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
The level at 1.2301 initially provided enough firm support to give a minor amount of profit from the bullish rejection, but the level eventually broke down convincingly following yesterday’s FOMC release which gave a relatively strong boost to the U.S. Dollar. This is significant as there are no major support levels until very close to the 1.2000 level, so the price has room to fall far and fast, with the line of least resistance certainly seeming downwards. Despite the long-term bullish trend, there is very little to be bullish about here on this pair, although there might be a bounce at 1.2214.
Concerning the EUR, there will be a release of the minutes of the most recent ECB policy meeting at 12:30pm London time. Regarding the USD, there will be a release of Crude Oil Inventories data at 4pm.