Last Thursday’s signals were not triggered as none of the key levels identified were reached that day.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken prior to 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 1.1738 or 1.1775.
- 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
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1684, or 1.1638.
- Put the stop loss 1 pip below the local swing low.
- 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 noted last Thursday that a bullish wave appeared to be running out of steam in the 1.1750 area.
I saw the resistance level at 1.1775 as likely to remain strong. This suggested that some kind of bearish retracement was due.
This was a good call as the resistance level at 1.1775 has continued to hold for several days.
Although there is residual bullishness, we begin to see early signs of a medium-term bearish head and shoulders pattern completing, with the head just below 1.1775 and the shoulders situated at about 1.1750.
The final shoulder is also being held by lower resistance at 1.1738, which is another bearish sign.
There is no real long-term trend and such short-term movements seem to be predictable here are dubious as to strength and persistence, so it will be best to monitor any trades closely on short time frames.
I will be prepared to take a short trade today from a firm bearish rejection of 1.1738 or 1.1775, targeting 1.1684.
There is nothing of high importance scheduled today concerning the EUR. Regarding the USD, there will be a release of ISM Non-Manufacturing PMI data at 3 pm London time.