Free Profitable Forex Newsletter
Hey! This is Philip with this week's trade idea of the Free Profitable Forex Newsletter!
EURUSD is moving higher this week on the news of a Franco-German proposal for a joint 500 billion Euro recovery fund to support the hit the hardest areas of the Eurozone economy. It is good news for the Euro currency as a step in the right direction that markets were hoping for. Only last month, investors sold the Euro on the failed attempts of European leaders to agree on issuing joint debt as a way to deal with the shock from the coronavirus
pandemic.
However, at the moment, this only a proposal and still needs to get backing from other EU member states. Moreover, many see the €500 billion proposed fund as too small to aid the Euroarea economy during the worst recession in a generation.
Hence, the EURUSD rally may soon falter, especially as it is about to hit the 1.10 technical resistance area.
EURUSD May Reverse Again Once It Hits 1.10
As we also showed in our weekly analysis on Monday, EURUSD is trading in a roughly defined 1.08 - 1.10 range starting from early April. Two bullish attempts were rejected at 1.10 since then.
The current one is the third bullish attempt and could be an excellent opportunity to sell.
The 4-hour chart (see below) gives us more details of the price action. For instance, we can see how the overbought and oversold values on the RSI oscillator accurately identified the highs and the lows throughout this range. That is repeating now again as the RSI value hovers around the 70.00 level.
Our unique, advanced overbought/oversold indicator also accurately identified the tops and bottoms in this range.
However, while the prerequisites exist, a trigger for the entry is absent at the moment. Some traders may prefer to enter as soon as the resistance is reached, but others want to see a bearish signal or pattern to confirm a higher probability trade. We go with the latter and suggest entering short once a bearish signal occurs, either on the 4-hour timeframe and/or the daily.
- On bearish patterns in the 1.10 resistance area;
- Naturally, the 4-hour and lower timeframes would provide earlier entries and clues for a reversal
Stop loss:
- Above the 1.10 resistance level;
- And also based on the entry pattern
Targets:
Trade signals from the past week
TOTAL: 0 pips in the past week
TOTAL: +2670 pips profit since October 1, 2018
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Thank you!
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Any opinions, news, research, predictions, analyses, prices or other information contained in this newsletter is provided as general market commentary and does not constitute investment advice. FX Trading Revolution will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
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