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Price has lots of room to range between $1.0920 and $1.1089.
My EUR/USD signal on 24th April was not triggered as the bearish price action took place above the highest resistance level which I had identified at $1.1056.
Risk 0.75%.
Trades may only be taken before 5pm London time today.
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.1089 or $1.1125.
- 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.
- Remove 50% of the position as profit when the price reaches 50 pips in profit and leave the remainder of the position to ride.
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.0920, $1.0896, or $1.0878.
- 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.
- 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.
In my previous analysis of the EUR/USD currency pair, I wrote it was doubtful whether bulls had the muscle to make another meaningful breakout and to get the price established above $1.1000. Therefore, I was looking for a short trade from that area.
This was not a good call, as after some initial hesitation, the price got established above the $1.1000 level quite easily.
The technical picture has not changed much. We have seen choppy price action clear away all the support and resistance levels which were located between $1.0920 and $1.1089 so the price has a range of approximately 170 pips to swing or chop around in.
At the time of writing approaching the London open, the price is in a weak bearish leg, but direction quickly becomes uncertain at this time of day.
As we do not really have a clear direction here, and as the price is established well within a wide range, and as we are awaiting very key market data from the Fed late in the New York session, I think the price will certainly remain within its range until the Fed’s release.
This means that the best strategy here will likely be to scalp any reversal off any support or resistance level which may happen, but it will be important to closely monitor any open trade as price action looks likely to be choppy.
The Fed’s release is likely to see the price spike to at least one key support or resistance level, so it may be possible to enter a trade a few minutes after the release on a short time frame if that happens.
There is nothing of high importance due today concerning the EUR. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change Forecast at 1:15pm London time, followed by ISM Services PMI at 3pm, and then the FOMC Statement and Federal Funds Rate at 7pm plus the Fed’s press conference half an hour later.
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