EUR/USD Forex Signal: Bullish Breakout Beyond 1.2000 – DailyForex.com

The euro is showing serious bullish momentum.

Last Tuesday’s EUR/USD signals were not triggered, as there was no bearish price action when the resistance level identified at 1.1922 was first reached.

Today’s EUR/USD Signals

Risk 0.75%.

Trades must be taken before 5pm London time today only.

Short Trade Ideas

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2070, 1.2109, or 1.2142.

  • 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

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.1989 or 1.1943.

  • 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.

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EUR/USD Analysis

I wrote last Tuesday that we had a bullish move which seemed to have run out of steam due to the price reaching close to an area of important long-term resistance at and just below 1.2000. I thought that this bullish consolidation between 1.1860 and 1.1922 but that if the price could get established above 1.1922 that will be a bullish sign, but any move would probably not have much further than that to run over the near term.

This was an accurate call, as we saw the price get established above 1.1922 then continue to rise by another 30 pips or so over the course of that day, and the rise then continued over the past week.

We are seeing a reasonably strong selloff of the U.S. dollar with the euro one of the strongest major currencies, so this pair is certainly in focus and still exhibiting bullish momentum over the medium term. The bullish breakout beyond what looked like strong resistance in the 1.2000 area is a technically significant bullish sign.

The rise has halted over the short term at the nearest resistance level of 1.2070, with two more resistance levels below 1.2150 after which the price could go on to make new long-term high prices.

Due to residual bullish momentum, I will be looking to trade this pair in the long direction, but I want to see a retracement to the 1.2000 area first. Traders can try to get long before this level is reached but it does not look especially obvious that the price will have the strength to make new highs above 1.2070.

EUR/USD

There is nothing of high importance scheduled today regarding either the USD or the EUR.

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