EURUSD: Still bearish below 1.1024
Yesterday’s signals were not triggered as there was no bearish price action at 1.0998 and the bearish price action at 1.1024 happened too late and too slowly. However, 1.1024 captured the day’s high price to the pip.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 5pm London time today only.
Short Trade Idea
- Short entry following a bearish price action reversal on the 1H1 time frame time frame immediately upon the next touch of 1.1024.
- Place 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.
- Take off 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 I was very ready to take a short trade if we had gotten a bearish failure and the start of a strong downwards push at either 1.0998 or 1.1025. I thought that the price could be ready to fall a long way as there were no key support levels for almost another 150 pips below the current price, so I was enthusiastic to take a bearish bias here following the right set-up.
This was a good call as we did get a clear bearish turn just 1 pip underneath 1.1025, but it happened late, after the end of the London session.
There is a long-term bearish trend and the Euro is one of the weakest major currencies while the U.S. Dollar is relatively strong.
Technical analysis supports a bearish case, but we have seen some buying at and above 1.0970 so it not clear that the price is going to fall cleanly below recent lows. I prefer to wait for another retracement and failure at 1.1024 before taking a bearish bias, but if the price closes below 1.0969 at the end of today I would want to take a bearish bias right away provided the price was near the low which had been during the day.
There is nothing of high importance due today concerning the EUR. Regarding the USD, there will be a release of Crude Oil Inventories data at 3:30pm London time.