EUR/USD: New long-term bullish trend getting underway
Last Thursday’s signals were not triggered as there was no bearish price action when the resistance level identified at 1.1056 was first reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered before 5pm London time today.
Short Trade Idea
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1251.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
Long Trade Ideas
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1089 or 1.1056.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to ride.
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 I was happy to be long of this pair until at least 1.1056 was reached provided the support at 1.0954 continued to hold.
This was a good and profitable call as the price advanced over the day to a level higher than even 1.1056.
The price action remains bullish, despite Friday’s late pullback. The price was unable to end the week at a new 50-day high closing price, but it is currently trading above that level. It seems clear that the long-term trend has reversed from bearish to bullish, and the USD is weak everywhere, while the Euro is one of the stronger major currencies.
Technically, the way new higher support levels have been printed and hold once tested, is a bullish sign. The fact that the price has accelerated its rise to break out of its former ascending price channel is a further sign.
I remain bullish as the price has plenty of room left to rise to the next area of strong resistance which is probably located at the psychologically important major quarter-number at 1.1250.
I would be very happy to take a long trade if we get a bullish bounce following a retracement to 1.1089, or if the price closes at the end of today’s New York session above 1.1142.
There is nothing of high importance due today concerning the EUR – it is a public holiday in France and Germany. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.