Euro In Trouble For Continued Downside Against The Dollar
We saw a strong bounce off of the 61.8% fibonacci zone, but we're coming up on a strong resistance that was previously a strong support.
I like to play these Support/resistance flips the first time they test it as the supply usually keeps the price from moving through the level and they are nice shorts with a strong RR for less risk.
I have a relatively tight stop as I could also see a potential push through the resistance to the top diagonal resistance level that we've seen hold back the price several times now.
I don't foresee that happening though, but it's important to weigh all the angles when looking at a trade.
If I get stopped out, I may take another go at it from that level also as it has confluence with both diagonal and horizontal resistances.
On the daily, the 20MA is lining up with our short zone nicely for a possible retest.
On the 240 (4 hour), we are also seeing a possible retest of the 30MA, that has been very pivotal for the
EURUSD
chart as you can see it used it as support on it's most recent rally.
Looking at the macro picture, we can see we've got a gap way down below around the 78.6% level as well as a bearish picture that is being painted for a full retrace back to the bottom for a potential double bottom.
Listening to Chairman Powell's comments on the US Economy from 60 minutes aligns with my trade thesis as he stated that the US economy looks healthy on every metric and we should see continued growth into 2019 without any rake heights from the Fed.
As always, manage your risk and try and maintain at least a 2:1 or 3:1 RR on all of your trades to maintain profitability in the long run.
This is a small swing trade position on the smaller time frame, but if we do break that 61.8% level and the blue line from previous support doesn't hold, next supports are a ways down based on the VPVR as well as the fibonacci level.
Cheers and happy trading!
I like to play these Support/resistance flips the first time they test it as the supply usually keeps the price from moving through the level and they are nice shorts with a strong RR for less risk.
I have a relatively tight stop as I could also see a potential push through the resistance to the top diagonal resistance level that we've seen hold back the price several times now.
I don't foresee that happening though, but it's important to weigh all the angles when looking at a trade.
If I get stopped out, I may take another go at it from that level also as it has confluence with both diagonal and horizontal resistances.
On the daily, the 20MA is lining up with our short zone nicely for a possible retest.
On the 240 (4 hour), we are also seeing a possible retest of the 30MA, that has been very pivotal for the
EURUSD
chart as you can see it used it as support on it's most recent rally. Looking at the macro picture, we can see we've got a gap way down below around the 78.6% level as well as a bearish picture that is being painted for a full retrace back to the bottom for a potential double bottom.
Listening to Chairman Powell's comments on the US Economy from 60 minutes aligns with my trade thesis as he stated that the US economy looks healthy on every metric and we should see continued growth into 2019 without any rake heights from the Fed.
As always, manage your risk and try and maintain at least a 2:1 or 3:1 RR on all of your trades to maintain profitability in the long run.
This is a small swing trade position on the smaller time frame, but if we do break that 61.8% level and the blue line from previous support doesn't hold, next supports are a ways down based on the VPVR as well as the fibonacci level.
Cheers and happy trading!
Trade active:
Entering the short trade zone.