Last Thursday’s signals were not triggered, as there was no bullish price action when the support level identified at 1.1834 was first reached.
Today’s EUR/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm London time today only.
Short Trade Idea
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.1929.
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 1.1841, 1.1815, 1.1789, or 1.1745.
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 wrote last Thursday that the technical picture, apart from the strong resistance beginning near 1.1900, looked messy and mixed. I did not want to make a call on direction beyond that there may be an excellent long-term short trade opportunity setting up from a bearish reversal above 1.1900, ideally at 1.1929.
This was a pretty good call as the price has continued to move sideways, ranging slightly and not doing anything dramatic, so it probably has been best to stay out of this market for the time being.
The environment today is mildly risk-on which is tending to weaken the U.S. dollar. This would suggest higher prices are likely, but any bullishness here looks weak and we do not see the price making any firm bullish move. The British pound seems to be breaking to new highs while the euro is not, which is another argument against being bullish here.
The best strategy for this currency pair in this environment is probably to look for reversals at price extremes, such as a bullish bounce at 1.1815 where a bullish double bottom has already printed over recent days, or a bearish reversal at 1.1929 which could be an excellent long-term trade as that area of resistance has held for a long time.
Regarding the EUR, there will be a release of French Flash Services PMI data at 8:15am London time, follwoed by German Flash Services & Manufacturing PMI at 8:30am. There is nothing of high importance due today concerning the USD.