EURUSD: Weakly bearish below 1.1110
Last Thursday’s signals produced a nicely profitable short trade entry from 1.1169.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken before 1pm London time today.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1110 or 1.1141.
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 1.1083, 1.1043, or 1.1039.
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 outlook should remain bullish as long as the price stayed above 1.1145. I also noted the ECB release later that day could create price movement.
This was a good call as the price did continue to advance to the next resistance level at 1.1169 before turning strongly bearish and making a reversal when the ECB release came out tonight, which had a somewhat dovish effect on the price.
There is no long-term trend in this pair, so we have to look to medium-term price swings.
We see that the price may be bottoming out near the support level at 1.1083 creating a potential bullish double bottom. However, bulls should wait for the price to get established above 1.1110 as the price still looks weak and prone to more downwards movement. However, this area close to 1.1000 could be quite good support in our relatively trendless environment.
There is nothing of high importance due today concerning either the EUR or the USD. It is a public holiday in the USA today.