This EUR/USD trading plan is based on a bullish breakout strategy, with execution hinging on a daily candle close above the key 1.1000 level. The close above this threshold will act as a confirmation of the bullish sentiment, suggesting strength in the upward trend. Following this signal, the strategy involves setting a buy limit order at 1.092, anticipating a minor retracement that provides a favorable entry point while maintaining the integrity of the bullish outlook.
The selection of 1.092 for the entry takes into account the typical ebb and flow post-breakout, allowing traders to capitalize on a pullback for better positioning. The first profit target (TP1) is set at 1.1200, a level with historical significance that may present a reasonable hurdle for the price. The second profit target (TP2) at 1.1500 is more aspirational, aligning with a major resistance area on the broader timeframes, thus offering a compelling reward should the bullish trend continue.
A stop loss at 1.0650 is strategically placed below recent lows to mitigate potential losses, providing a sound risk management structure. This SL placement ensures the trade can withstand some volatility without being prematurely stopped out.
The strategy is underpinned by current fundamental factors such as interest rate paths and inflation differentials between the Eurozone and the U.S., which are critical drivers for the currency pair. Moreover, the trade setup is adaptable, with a readiness to respond to new economic releases and shifts in market sentiment.
The selection of 1.092 for the entry takes into account the typical ebb and flow post-breakout, allowing traders to capitalize on a pullback for better positioning. The first profit target (TP1) is set at 1.1200, a level with historical significance that may present a reasonable hurdle for the price. The second profit target (TP2) at 1.1500 is more aspirational, aligning with a major resistance area on the broader timeframes, thus offering a compelling reward should the bullish trend continue.
A stop loss at 1.0650 is strategically placed below recent lows to mitigate potential losses, providing a sound risk management structure. This SL placement ensures the trade can withstand some volatility without being prematurely stopped out.
The strategy is underpinned by current fundamental factors such as interest rate paths and inflation differentials between the Eurozone and the U.S., which are critical drivers for the currency pair. Moreover, the trade setup is adaptable, with a readiness to respond to new economic releases and shifts in market sentiment.