EURUSD: Bearish consolidation above 1.1100
Yesterday’s signals were not triggered, as none of the key levels were ever reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm London time today only.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1188 or 1.1199.
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 Idea
Go long immediately upon the next touch of 1.1030.
Put the stop loss 1 pip below the local swing low.
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 although the long-term low had not been broken yet, the outlook looked bearish here, and I was ready to take a bearish bias if the price was below 1.1110 at 9am London time today. It was not, and the price has actually risen a little over the past 24 hours, so this was a good enough call to stay out of trouble.
The Forex market is currently dominated by a strong move down by the British Pound which is triggered by the new British government being seen as more likely to be ready to leave the E.U. on 31st October, and on “no deal” terms if necessary. It is interesting that the Euro is holding up even while the Pound is falling as these currencies are typically positively correlated. It suggests that capital is flowing from Pounds into Euros and this is likely to maintain the bearish consolidation we see here in the EUR/USD currency pair at present above 1.1100.
A sustained break below 1.1100 would be a bearish sign, but there is support above 1.1100 so I cannot be bearish yet.
There is nothing of high importance due today concerning the EUR. Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time.