EUR/USD: Euro is not crashing
Yesterday’s signals were not triggered as the support level at 1.1250 was not hit until after the London session closed.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered before 5pm London time today.
Short Trade Idea
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1517.
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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1250, 1.1218, or 1.1185.
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 I would be happy to take a long trade from a bullish bounce at 1.1250 if it set up. This was a great call as yesterday’s low was made at that price, but unfortunately it happened late, so did not give a valid long entry sign.
The technical picture has changed little – we still have an obvious area of support at and below 1.1250, but we do have a new lower resistance level at 1.1381.
As long as the support at 1.1250 holds up, we are likely to see the price consolidate between 1.1250 and 1.1381. However, the ECB are giving their monthly policy guidance today, which could see the Euro affected. The coronavirus outbreak is also coming into focus in several key Eurozone countries.
I think the best approach today will be to trade any reversals at any key level and to them monitor any trades on short time frames to stay nimble and take profits before the high volatility causes a major turn in the price.
There is nothing of high importance due today regarding the USD. Concerning the EUR, there will be a release of the ECB’s Monetary Policy Statement and Main Refinancing Rate at 12:45pm London time, followed by the usual press conference at 1:30pm.