Yesterday’s signals produced a long trade entry following the large bullish engulfing candlestick which rejected the support level at 1.1444.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm London time today only.
Short Trades
- Short entry following a bearish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 1.1486.
- 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.
- 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
- Long entry following a bullish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 1.1444 or 1.1400.
- 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.
- 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
I wrote yesterday that short trades still looked like a good bet. I thought that if the price could break below 1.1444, a further move down to at least 1.1400 would be very likely to happen, so I had a bearish bias below 1.1444. This was a good call as 1.1444 was a pivotal level and when there was a bullish rejection just after London opened, it was a signal that the price was going to generally rise over the day, although it did look as if the price might break down later.
Looking at the bigger picture, we may have a medium to long-term double bottom forming at 1.1444, although resistance at 1.1486 is also holding. Overall, the next directional move is uncertain, but there is certainly a weak, long-term bearish trend, so I would still be bearish below 1.1444.
There is nothing important due today concerning either the EUR or the USD.