The medium term daily candle chart below shows the price history of the Euro currency (EUR) versus the United States Dollar (USD). This currency pair is known as EURUSD, and is trading near 1.1308 around time of publication, and near session lows.
Last time EURUSD was reviewed in Ideas You Can Trade the expectation was that a circular pattern formation would enable the pair to move lower after trading mostly sideways. That predication didn't happen fully as the pair has since recovered a higher support line and has been mostly range-bound between 1.1300 and just above 1.1500.
However, the higher steep bearish support line (in aqua color on chart below) was indeed regained in the last few days (also mentioned in the last post), and could turn into support, and help the EURUSD ascend a bullish support line (blue line on chart below) that it appears to be climbing (line is drawn from recent multi-year low under 1.11). That blue line is failing however in today's session and could prompt a drop further, unless recovered before the end of the trading week closes today in New York.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 1.1458 with a Limit to take profit @ 1.1535 and a stop-loss @ 1.1406 Risk/Reward Summary: Limit risk = +77 pips profit / (-52) Stop-loss risk = Gain to Loss ratio = 1.48
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 1.1295 with a Limit to take profit @ 1.1205 and a stop-loss @ 1.1367 Risk/Reward Summary: Limit risk = +90 pips profit / (-72) Stop-loss risk = Gain to Loss Ratio = 1.25
Medium Term daily Candle Chart (Zoomed-in):