My previous EUR/USD signal on 18th March produced a profitable short trade from the bearish reversal from the resistance level at $1.0951.
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 timeframe immediately upon the next touch of $1.1005, $1.1041, $1.1078.
- Put 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 timeframe immediately upon the next touch of $1.0931, $1.0879, or $1.0826.
- Put the stop loss 1 pip below the local swing low.
- 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
In my previous EUR/USD analysis a few weeks ago, I thought that the EUR/USD currency pair was looking potentially like to begin a long-term bullish trend, but was also possibly going to offer a day trading opportunity long at a bounce from support. I was right about the first thing but wrong about the second, as the strong resistance level at $1.0951 survived two test from below over the day, giving an opportunity for a profitable short trade entry.
Here we are a few weeks later, and of course the big news is yesterday’s announcement by President Trump that the US will be imposing a 20% tariff on all imports from the European Union, effective immediately. This had the effect of sending the Euro strongly higher against the Dollar, pushing the price back above the key resistance level of $1.0951 to a new 5-month high price. As I write, the price is not far from the big round number at $1.1000 which is very confluent with the resistance level at $1.1005.
The Euro is still gaining, and the momentum and fundamental event here is clearly overpowering technical considerations. This suggests that day traders can look for long trades from pullbacks now, but the problem with this is it is very hard to know where the momentum will stop.
As a longer-term trend trader, I will be entering a long trade in this currency pair today if it ends the New York session above $1.0951.
There is nothing of high importance due today concerning the Euro. Regarding the USD, there will be a release of Unemployment Claims data at 1;30pm London time, followed by ISM Services PMI at 3pm.
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