EURUSD: Weakly bearish with 1.1043 pivotal
Yesterday’s signals produced a losing short trade from the bearish inside candlestick breakdown on the hourly chart from 1.1068. However, I did say I was not looking to trade this pair yesterday.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken prior to 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 1.1079, 1.1093, or 1.1113.
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.
Long Trade Ideas
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1043, 1.1039, or 1.0993.
Place 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.
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 there was strong resistance at 1.1068 which continued upwards to about 1.1075, so a bearish reversal in this area was likely to show the day’s pivotal point there and could produce a short trade for at least 20 pips or so of profit. This was not a good call as it turned out wrong, with a false bearish rejection preceding a pop above that area which held for a few hours. However, I did say I was not looking to take a bias on this pair.
The technical picture has changed little, I’ve just adjusted the nearest resistance level upwards by a few pips to reflect yesterday’s action. Overall, the situation looks a little more bearish and the short-term momentum is slightly bearish so we may see a move down to the 1.1050 or below, where the support levels are likely to hold today.
There is no real long-term trend now, the longer-term charts show price action is quite choppy and ranging in this currency pair. Therefore, I would not look to trade this pair. Long scalping trades from the support levels below may be an option here later.
There is nothing of high importance due today concerning the USD. Regarding the EUR, there will be a release of German ZEW Economic Sentiment data at 10am London time.