EUR/USD Forex Signal: Bullish Again – DailyForex.com

The EUR/USD is facing long-term resistance below 1.2200.

Last Tuesday’s EUR/USD signals produced a short trade entry from the bearish rejection of the resistance level identified at 1.2092, but it gave little more than the minimum of 20 pips of profit.

Today’s EUR/USD Signals

Risk 0.75%.

Trades may only be taken between 8am and 5pm London time today.

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2157.
  • 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 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 1.2116, 1.2100, or 1.2025.
  • 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.

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EUR/USD Analysis

I wrote last Tuesday that although we had seen strong medium-term bullish momentum in this currency pair, it may well be fading away as the price approached a key inflection zone roughly between 1.2100 and 1.2200. This was an OK call as the price traded sideways that day.

I was looking for either a long trade from a bounce at 1.2026 or a short trade from a bearish reversal at 1.2157, but neither opportunity set up.

We are now seeing a more bullish technical picture as the advance of the price has resumed, with a bullish medium-term breakout to prices well above 1.2100. The price chart below shows we are seeing a clear series of higher lower and higher highs and this pattern has been in effect since a few days after the start of this month of April.

Despite the medium-term bullish momentum, the price is quite likely to struggle to get above 1.2156 as a long-term resistance area begins there.

I see long trades at any bullish bounce from either 1.2116 or 1.2100 as likely to be reasonably good trading opportunities in this currency pair today, but traders should bear in mind we still do not have a valid long-term trend, so it will probably be wise to be conservative with profit-taking.

EUR/USD

Regarding the USD, there will be a release of U.S. Advance GDP data at 1:30pm London time. There is nothing of high importance scheduled today concerning the EUR.

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