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 1.1036 around time of publication, and near session lows of 1.1025 today.
Last time EURUSD was reviewed in Ideas You Can Trade at the end of February, support had been found on 1.1200 - but that support was lost yesterday and prompted the lower-low today which also marks a new multi-year low for the Euro against the US Dollar.
Unless 1.1200 is recovered in the very short-term, the trend will likely stay bearish, and possibly worsen. For example, a breach of 1.1000 could accelerate the bearish momentum, whereas a bounce from current levels may help the pair build support before moving even lower.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 1.1151 with a Limit to take profit @ 1.1199 and a stop-loss @ 1.1116 Risk/Reward Summary: Limit risk = +48 pips profit / (-35) Stop-loss risk = Gain to Loss ratio = 1.37
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 1.1024 with a Limit to take profit @ 1.1001 and a stop-loss @ 1.1048 Risk/Reward Summary: Limit risk = +24 pips profit / (-23) Stop-loss risk = Gain to Loss Ratio = 1.04
Medium Term Daily Candle Chart (Zoomed-in):