Forex Signal # 1 – Trade Setup EUR/USD

Posted on 11. Mar, 2010 by Moderator in Forex Signals, How To, Random Noise

I am currently looking at EUR/USD and it is beginning to form a triangular pattern. Click the picture below to see a 4-hour timeframe chart of the EUR/USD and you can see the formation between the two red trend lines.

Currently it looks like a possible bull break, and this is what I will be watching for. However, if it breaks to the downside, I will take that trade as well. Now click the small picture below to see a picture of the EUR/USD on a 1-hour timeframe.

First of all I know that a bull trade would be countertrend, but due to the enormous fall of the EUR/USD in the last couple of weeks, I think it is fair to argue that we need to see some retracement, before we get another spike down. In addition to this, if you look at EUR/USD on a weekly timeframe, you will see a lot of candlesticks which could indicate a reversal (spinning tops/doji´s). If you zoom out and look at the chart from a monthly timeframe, you will see that we are close (and have touched) a very strong support level, and on the 4-hour timeframe there is clearly some MACD divergence. All in all, I think there is a good chance to get in on a long trade, which could potentially last for some time. Back to the 1-hour timeframe. I would like to see a close of, at least a 1-hour candle above the trend line, and preferably above 1.3680. However I don’t want to see the pair too far away from the trend line. I would say that if it closes the 1-hour candle more than 50 pips above 1.3680 I will not enter at that moment, but wait for a possible retest of 1.3680 and then enter. If it closes above the trend line (and preferably above 1.3680) and below 1.3730 I will enter on a long trade with a stop loss just below the trend line and keep my take profit open. I will then look to move my stop loss to break even after some 50 pips of profit. Let´s see how things play out.

Related posts:

1. Forex Signal # 3 – Trade Setup EUR/GBP
2. Forex Signal # 2 – Trade Setup EUR/USD
3. Good-Loking USD/JPY Setup
4. Forex Signal # 1 – Update
5. Trading Forex – EUR/USD

Tags: forex signal, forex trading, my signals, Trading Forex