Yesterday’s signals produced a long trade from the support level at 1.1848 following the bullish inside candlestick which formed and broke up on the hourly chart. However, this pair only made 20 pips of profit and so would have broken even.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered before 5pm London time today.
Short Trades
* Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1883 or the bearish trend line shown in the price chart below, which is currently sitting at about 1.1935.
* Put 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.
* 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.
Long Trades
* Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1817, 1.1814, or 1.1794.
* Put 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.
* Take off 50% of the position as profit when the price reaches 25 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
I wrote yesterday that I again have a bearish bias today, but I noted the cluster of support levels below 1.1885 which may be hard to break. The price continued to fall, so I was correct, and it also managed to break two support levels, and looks to be in the process of breaking below 1.1847. This is the most strongly trending currency pair, with the Euro currently the weakest of all major currencies. There is also new lower resistance at 1.1883. There is every reason to remain bearish on this pair, although there is now some divergence between the normally strongly positively correlated Euro and the British Pound, with the GBP/USD currency pair looking as if it is forming a double bottom at the psychologically key round number of 1.3500.
There is nothing due today concerning the EUR. Regarding the USD, there will be a release of PPI data at 1:30pm London time, followed by Crude Oil Inventories at 3:30pm.