Trading Forex – Perfect 1.3440 Retest – Now What?

Posted on 29. Nov, 2011 by in Daily Outlook, Forex Signals, How To, Random Noise

For those of you who read today’s outlook had an idea I was looking for a possible short around the 1.3440 level. Unfortunately I wasn’t able to place a trade today once the level was reached but if you did, this would have been close to a perfect trade. The level was spot on as solid resistance, and the pair is now trading back down at the 1.3330 level. So basically the pair is right back at the same level as where it started the day. So where do we go from here?

Trading Forex – Bias

My bias hasn’t changed. News from US has been mixed for the first two days, but the Euro zone situation continues to take the main attention and with no significant deviation on US news, I see no reason for a change in bias, other than what I have mentioned in earlier posts regarding some possible profit taking. Tomorrow we will get ADP Non-Farm Employment Change from US, expected to come out at 131 compared to 110K previous release, so any kind of pre-news sentiment should also be to the downside for EUR/USD.

Trading Forex – Technical Perspective

As mentioned in todays post, on the 4-hour chart we are still seeing higher highs and higher lows. However, this almost start to look more and more like an inverse flag formation which also gives us a clue of possible further downside. However, the most interesting thing is the daily candlestick formation. Well the day is not over yet, but unless we see a significant move within the next 45 minutes, we are likely to get a good reversal candlestick formation, also indicative of possible further downside.

It is possible that we could see some upside during the Asian session, but I actually think that the pair is very likely to start a move down shortly after EOD. But who knows. I will be asleep shortly and hence I would prefer to wait for tomorrow morning around London open, to look for a possible short trade.

Trading Forex – Ideas

With the above mentioned aspects in mind, I still prefer to look for a short trade.

I will pay attention to price action around London open tomorrow morning and look for a possible short trade. The best case scenario in my opinion would be that the pair trades around the current level (Read; 1.3330) and look for a short trade with close to a 50 pip stop loss. Of course, if price starts to move up, right around London open, I will wait on the sideline for an entry short, at a higher level. 1.3440 is still at key level to have in mind.
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Related posts:

  1. Trading Forex – Perfect Trade but Still in Range
  2. Trading Forex – EUR/USD – A Perfect Play and Upside
  3. Trading Forex – EUR/USD – Upcoming Week
  4. GBP/JPY – Close to a perfect Setup
  5. Trading Forex – EUR/USD Before FOMC

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