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EUR/USD plummets to new 19-year low.
My previous EUR/USD signal last Wednesday produced a losing short trade from $1.0195, although the same level was later rejected to provide the high of the day, so I was correct about that resistance level.
Today’s EUR/USD Signals
Risk 0.75%.
Trades may only be entered between 8am and 5pm London time today.
Short Trade Idea
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $0.9950 or $1.0000.
- Place the stop loss 1 pip above the local swing high.
- Move 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 50 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $0.9900, $0.9850, or $0.9800.
- Place the stop loss 1 pip below the local swing low.
- Move 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.
EUR/USD Analysis
In my last analysis of the EUR/USD currency pair on 17th August, I saw the technical picture as more bearish following the breakdown below the ascending trend line, which was confluent with a clear level of resistance at $1.0195, which was also quite confluent with the round number at $1.0200. I saw a short from there as the best potential trade of the day and I was not wrong, although the initial rejection during the New York session saw the high exceeded again later.
The technical picture now is even more bearish, as the price plummets through blue sky to new 19-year lows which have not been seen since 2022, well below parity.
There are no obvious support levels, except perhaps round and half numbers.
There is strong bearish momentum, and longer-term traders could have a good opportunity to go short if we see a bullish retracement to $0.9950 or even the parity level at $1.0000.
Shorter-term traders can try to ride the momentum by selling rallies on short-term time frames, perhaps being cautious of trading right into any major round numbers.
Trend traders will not want to miss the bearish momentum here.There is a very strong bullish market and long-term trend in the US Dollar, with the Euro one of the weakest major currencies (the British Pound is the other), so we can expect plenty of action here today as this pair is in the market’s focus.
Concerning the USD, there will be a release of Flash Services PMI data at 2:45pm London time. Regarding the EUR, there will be releases of French, German, and British PMI data between 8:15am and 9:30am.
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