Daily Outlook: The long- and medium- term picture is still as bearish as it gets, but for the past week or so we've had some mixed bullish signals as well. I kept selling all of last week - and profited off of it - but in general took less trades as the short positions just weren't there. I even listed my primary trade for Friday as a buy (though as I mentioned I stayed out of the Friday markets).
Since then the short term picture has turned a bit bearish again, breaking through rising trend support (bottom blue line on chart) and then recently breaking through support at 1.2270 where the pair currently sits. For me the key area is 1.2300 - if it stays below this I am short-term bearish, if it makes a sustained break above I am short-term bullish.
Not much on the news calendar today, some German unemployment data which is forecast to improve. If it improves less than expected this could send the EURUSD down. Also we have the CAD interest rate decision at 14:00 GMT. Normally I wouldn't bring it up but they are expected to hike rates. If they don't this could send the EURUSD down or if they do more than expected this could send the EURUSD up. Read more details at the forex calendar.
Trading Idea: In general I am looking for shorts below 1.2300. My primary trade will be a short in the vicinity of 1.2300 with confirmation and targets down to 1.2275, 1.2250, 1.2230, 1.2200 and 1.2150 for 150 pips profit. A more aggressive trade would be a short on a sustained break of 1.2240 with targets down to 1.2150 for 90 pips profit.
As always never trade more than you can afford to lose and be patient. There is always another trade and this isn't a race.
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