Last Thursday’s signals were not triggered, as there was insufficiently bullish price action at 1.1397.
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 1.1316 or 1.1397.
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 Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1250.
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 last Thursday that the upwards move looked likely to continue over the course of the day. I was ready to take a bullish bias if we got an hourly close above 1.1450 during the London session today, until 1.1475. I was completely wrong on one way as the move of the day was strongly bearish but correct in seeing a close above 1.1450 as a pivotal event to watch for – once that failed to happen, the downwards movement got going, and really followed through at the end of the week.
We have a long-term bearish trend in the Euro, and markets are dominated by risk-off sentiment. These days that tends to mean a slow downwards drift in this currency pair, as the Euro is not seen as a very risky currency any more. If the price gets established below 1.1250 that would be a very bearish sign, but for now 1.1316 is likely to be the pivotal level. If the price tests that today and fails to break above it, we will probably get a downwards move even though it is likely to be relatively small as today is a news-free Monday.
There is nothing of high importance due today concerning either the EUR or the USD.