Recap: Welcome to another day PipHutters! I'm glad that many of you were able to get in on the aggressive long signal yesterday at 1.2570. From yesterday's signal:
The most aggressive trade would be a long off of 1.2570 as this is the neckline area of the head and shoulders pattern.
We had lots of confirmation on this one: 1h bullish doji, 4h GMT bullish doji while just touching former head and shoulder's neckline. Add into that some confluence with the rising inner support line (thin blue line on my chart) and you have a pretty high probability trade :).
The result? The pair has risen over 120 pips. This is a great example of one of those setups that develops in front of you - there is no way to issue a buy/sell recommendation until it develops and the only way to trade it is to have the skill set to recognize the confirmation signals when they appear.
Daily Outlook: Not much has changed here. Still short term bullish and long term bearish. As a result for my day trades I will continue to look for opportunities to buy into dips. A couple things worth noting:
1) 30m and 1h candlesticks from the candlestick alert system were very profitable yesterday. There are traders who look at nothing but candlesticks are profit from them. Don't ignore tools that are right in front of you.
2) Lots of news tomorrow, most of which won't effect the pair too much but could. Check out the forex calendar. As always it is the unplanned news events that seem to move the pair the most.
Trading Idea: My primary trade will be to look for long opportunities near the dip to the inner support trend line (thin blue line). This is currently in the 1.2600-1.2570 support zone. Longs from 1.2580 will target 1.2605, 1.2635, 1.2665 and 1.2695 for 115 pips. Don't short change yourself out of profits either :). Using good money management and only taking profit when the technicals change is important.
Secondary trade will be to look for a long near the bottom of the full channel (thick bottom blue line) - currently at 1.2540. Long targets from here will reach up to 1.2650 for 110 pips profit.
As always, happy pipping :)