EUR/USD: Support at 1.0814 has broken down
Yesterday’s signals were not triggered, as neither of the key levels were ever reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 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 1.0817 or 1.0887.
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 Idea
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.0710.
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 the picture was now looking increasingly bearish as not only had the support at 1.0840 broken down, but so had the support at 1.0814. The price now has room to fall all the way to the next support level at 1.0710 or perhaps the big quarter-number at 1.0750. I thought that there was no reason not to take a bearish bias as long as hourly closes below 1.0814 persisted and they did.
The price has not fallen much further over the past 24 hours, in fact it has gone mostly sideways and there is no floating profit yet from yesterday’s entry. However, the price is holding below the new lower resistance level at 1.0814 and this is a bearish sign. The Euro is weak, and the U.S. Dollar is strong, so market sentiment also supports a short trade here.
I take a bearish bias again on this currency pair today as long as we keep getting hourly closes below 1.0814. The price has room to fall to at least 1.0750.
Concerning the USD, there will be a release of Unemployment Claims data at 1:30pm London time. Regarding the EUR, the President of the ECB will be making a minor speech at 3pm.