EURUSD → Short to 1.06? Or Will we Break Resistance to Long?
EURUSD was rejected twice at the Resistance Zone and ended last week with another leg up. Should we short here?
How do we trade this? 🤔
We had a decent entry last week, but that ended with a surprise leg up into the Resistance Zone. We now have a sell signal at the top of the zone, but need to wait for a strong bear bar closing on or near its low below the Resistance Zone around the 1.10 area. Stop loss should be placed above the Resistance Zone and set a take profit around 1:2 Risk/Reward at 1.065. It's also reasonable to take half profits at 1:1 Risk/Reward and swing the remainder of your position.
💡 Trade Ideas 💡
Short Entry: 1.09835
🟥 Stop Loss: $1.1150
✅ Take Profit: 1.06500
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Contact with Resistance Zone and Two Bear Bars
2. Look for Follow-Through and a close below Resistance Zone.
3. 1:2 Risk/Reward Ratio, Watch Out for Support at EMA Ribbons.
4. RSI at 60.00 and above Moving Average, Needs to Fall Below.
5. Also Reasonable to Scalp 1:1 and Move Stop Up to Entry.
💰 Trading Tip 💰
All trades carry a probability value based on statistical data of the price action. If the market exceeds 60% probability in a direction, it's reasonable to take the trade assuming your Risk/Reward and Probability are positive.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
How do we trade this? 🤔
We had a decent entry last week, but that ended with a surprise leg up into the Resistance Zone. We now have a sell signal at the top of the zone, but need to wait for a strong bear bar closing on or near its low below the Resistance Zone around the 1.10 area. Stop loss should be placed above the Resistance Zone and set a take profit around 1:2 Risk/Reward at 1.065. It's also reasonable to take half profits at 1:1 Risk/Reward and swing the remainder of your position.
💡 Trade Ideas 💡
Short Entry: 1.09835
🟥 Stop Loss: $1.1150
✅ Take Profit: 1.06500
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. Contact with Resistance Zone and Two Bear Bars
2. Look for Follow-Through and a close below Resistance Zone.
3. 1:2 Risk/Reward Ratio, Watch Out for Support at EMA Ribbons.
4. RSI at 60.00 and above Moving Average, Needs to Fall Below.
5. Also Reasonable to Scalp 1:1 and Move Stop Up to Entry.
💰 Trading Tip 💰
All trades carry a probability value based on statistical data of the price action. If the market exceeds 60% probability in a direction, it's reasonable to take the trade assuming your Risk/Reward and Probability are positive.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and comment if you found this analysis useful!
Comment:
EURUSD continues to ride the Daily 30EMA and has yet to give us a sell signal. The bulls do appear to be weak, what we need to look out for is a "bull capitulation" bar toward the resistance followed by a rejection bar; a strong bear bar closing on or near its low. That will give us enough probability to enter a short trade. It's not required to wait for a break below the 30EMA though, that does add to the probability of profit. Waiting for that break causes your entry to be further away from the proper stop loss above the Resistance Zone and thus, reducing your position size.
EURUSD continues to ride the Daily 30EMA and has yet to give us a sell signal. The bulls do appear to be weak, what we need to look out for is a "bull capitulation" bar toward the resistance followed by a rejection bar; a strong bear bar closing on or near its low. That will give us enough probability to enter a short trade. It's not required to wait for a break below the 30EMA though, that does add to the probability of profit. Waiting for that break causes your entry to be further away from the proper stop loss above the Resistance Zone and thus, reducing your position size.
-Joe Dean
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Trader Engineering Course (Coming Soon!)
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EURUSD came back down to the Daily 30EMA last week after a failed breakout of the Resistance Zone. We ended the week with a doji bar (one bar trading range) just above the 30EMA. The RSI fell below the Moving Average and now has a gap to fill. I believe we will have a pullback toward the Resistance Zone for one more failure to break and when we get that sell signal, it's reasonable to short per my original entry, stop loss, and target.