Yesterday’s signals produced a very profitable short trade following the bearish reversal doji candlestick at the resistance level of 1.1594 right at the London open. There is strong bearish momentum, so it will probably be wise to let at least a portion continue to run in profit.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered between 8am and 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 1.1496, 1.1539 or 1.1566.
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.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trades
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1444, 1.1400 or 1.1353.
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.
Remove 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
I wrote yesterday that the key thing to watch was probably going to be whether the 1.1600 level holds. The price was likely to spend the time following the major data release later moving away from that level. I was correct and in fact the price got nowhere near 1.1600, moving down very strongly with a rampant U.S. Dollar and very weak Euro moving in line with the long-term multi-month bearish trend. There is no news due today which is likely to change this, so I doubt that there will be any strong bullish movement. We are most likely to see a further move down or a consolidation, with the fact that the psychological level at 1.1500 has broken an additional bearish sign. I take a bearish bias today below 1.1500.
There is nothing important due today concerning either the EUR or the USD.