There is a potential short-term double bottom at $1.0900.
My EUR/USD signal last Monday produced a short trade that gave about 50 pips of profit from the pin bar rejecting the resistance level identified at $1.0888.
Today’s EUR/USD Signals
Trades may only be entered before 5pm London time today.
Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.0942, $1.0958, or $1.1026.Place 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.Take off 50% of the position as profit when the price reaches 50 pips in profit and leave the remainder of the position to run.
Long Trade Idea
Go long immediately upon the next touch of $1.0710.Place 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.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.
I wrote last Thursday that if the price remained below $1.0888, it would be likely to fall hard later today, giving another good short trade opportunity. If the price got established above that level, we would likely get a deeper bullish retrace before the downwards movement resumes.
This was a good call as that level certainly did act as a pivotal point last Monday and drove the price down by another 50 pips or so, giving a short trade opportunity as I had expected. The price then more or less got established above that level the next day, and we then saw a much stronger bullish retracement before the price started falling again, as I had also expected.
There is heavy technical resistance pushing the price lower, and a very strong US Dollar. The Euro got a boost from the ECB’s hawkish tilt last week, although this now seems to be wearing off. However, it remains true that there are weaker currencies than the Euro, such as the Japanese Yen and the British Pound.
Since this week’s open we have seen the price reluctant to fall below $1.0900, and it seems as if we may be printing a short-term double bottom. However, this will mean nothing until the price can get established above $1.0960. Bears still look more likely to prevail if the price remains below that level.
The US Dollar is so strong that I will be happy to take a short trade if we get a bearish reversal at any of the resistance levels specified above ($1.0942, $1.0958, or $1.1026).
There is nothing of high importance due today regarding either the EUR or the USD.