EURUSD: Strongly Bullish Breakout
Last Thursday’s signals may have produced a losing short trade from 1.1096 last Thursday, although I did recommend trading for scalps and not swings so the 8 pips or so of profit that trade gave may have been reasonable.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 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 1.1244, 1.1279, or 1.1317.
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 1.1144 or 1.1109.
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 last Thursday that the Euro was weakly bearish and should stay that way if it kept below the resistance level at 1.1110. It stayed below this level that day but broke above it and rose very quickly and strongly the day after that (Friday), so this was an accurate forecast of a pivotal point at least.
The price made a new 50-day high closing price last Friday on volatility roughly twice as large as the recent average pip movement, and the high was near the top of the day’s range. These factors indicate a probability that today will be another up day, so it is worth taking a bullish bias on this currency pair today. It is likely that the price will reach at least 1.1244 today, but as this resistance level is very key and confluent with a big quarter-number at 1.1250, today’s price action may find it hard to break. If the New York close is higher than 1.1250 today, that would be a very bullish sign.
There is nothing of high importance due today regarding the EUR. Concerning the USD, there will be a release of Chicago PMI data at 2:45pm London time.