Heading to rise above $1.0032.
My previous recommendations were not triggered last Wednesday for trading the EURUSD, as there was no downside price action when any of the resistance levels I identified that day were first reached.
Today’s recommendations for trading the EUR/USD currency pair
- The risk is 0.75%.
- Trades may only be entered before 5pm London time today.
Selling Trading Ideas
- Take a sell trade right following the price action reverses downward on the H1 time frame right on the next touch of $1.0146 or $1.0195.
- Set your stop loss 1 pip above the local swing high.
- Move the stop loss order to break the breakeven once the trade has made a profit of 20 pips.
- Take 50% of the position as profit when the price reaches 50 pips of profit and let the rest of the position work.
Buy trading ideas
- Take a long trade right following the price action reverses to the upside on the H1 timeframe right on the next touch of $1.0061 or $1.0032.
- Set your stop loss 1 pip below the local swing low.
- Move the stop loss order to break the breakeven once the trade has made a profit of 20 pips.
- Take 50% of the position as profit when the price reaches 20 pips of profit and let the rest of the position work.
The best way to identify a classic “price action reversal” is to close an hourly candle, such as a pin bar, doji, outside candle or even just a sunken candle with a higher close. You can exploit these levels or areas by monitoring the price action that occurs at the specified levels.
EUR/USD trading analysis
In my last analysis of the EURUSD on September 7th, I thought that despite the strength of the USD, the EUR was holding from $0.9900, so there may not be much downside left, and it would be better not to trade this pair short that day. This was a good call, as the price completed a double bottom that day a point or so away from the long-term low, and then started to rise.
The long-term bearish trend in this currency pair is still valid, but the relative strength of the EUR persisted as the USD weakened slightly or consolidated. This was likely supported by the 0.75% rate hike by the European Central Bank last Thursday, although this move was widely expected.
This currency pair tends to make deep bounces within trends, which is a reason to be cautious regarding any approach to the upside here. However, it is important that the price continues to create new higher support levels, while nullifying some of the previous resistance levels. These levels are good criteria to use in assessment trends over the medium term.
It appears that the main pivot point for today is the support I identified at $1.0032. A long trade from the bounce here to the upside might be interesting as a short term trade, and if the price does not break decisively below this level, the technical outlook should at least stay here to the upside.
I think it is also correct to look for a short trade from a strong bearish reversal at $1.0146 if it is reached later.
The chart was generated by . platform TradingView
There is nothing of significant importance due today regarding the Euro or the US Dollar.
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