EUR/USD Forex Signal: Bullish Breakout Regains Momentum

EUR/USD: Beware long-term resistance near 1.1500

Last Thursday’s signals were not triggered as the key support level at 1.1371 was not hit until after London closed.

Today’s EUR/USD Signals

Risk 0.75%.

Trades must be taken before 5 pm 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 1.1517 or 1.1570. 
• 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 1.1394, 1.1371, or 1.1321. 
• 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

Last Thursday, the ECB talked about increasing stimulus to the Eurozone and this has helped boost the Euro which is in a slow but significant long-term bullish trend. Friday saw the price close at a new multi-month weekly high close, above 1.1400, and the price has continued to rise as this week opens.

There are two problems for bulls to consider, however: firstly, the USD is relatively strong, so it may be more profitable to take long trades in the Euro against a currency which is relatively weaker. Secondly, we have a major psychological level and round number just ahead at 1.1500 which may be hard to break.

I am happy to enter a long trade today from a bullish bounce which may happen at any of the support levels identified above. Scalpers may also be interested in a short trade from the first touch of 1.1500 or 1.1517.

There is nothing of high importance due today regarding either the EUR or the USD.