I hope you are fine and have enjoyed a good rest this weekend! I went to fish but I caught nothing. Although I like to fish a lot, I am a bad fisherman. Without further delays lets go for our technical analysis for this week.
We noted strong bullish moves last week after testing twice the 1.2750 area. Looking at my weekly eurusd charts with Stochastic Oscillator 9,6,6 attached on it, we can notice a strong bullish divergence.
Last Friday in the forum, I wrote a comment about the recent prices behavior. One of the best leading indicators for me is the price actions itself and Friday a big bullish move made me believe that 1.30 could not to be a top like we fought! Now the recent price levels are proving this to be right. By the time I´m writing it, the EUR/USD is 1.3060, above our so called key level 1.3000.
We have now good basis to plan our trade. With the bullish divergence, price action itself, and our key level 1.30 being violated, we will be seeking for bullish opportunities.
Let´s plan our trade:
Price now is above 1.30 and I fear we have already lost the opportunity to trade it. But if we have an opportunity to see a retracement, the best place to buy is somewhere between 1.3000 and 1.3030.
Look for good and reliable candlestick confirmation there and preferably H4 chart rather than the H1 chart. Don´t forget to use proper money management and stop loss. Our long term trade target from here is 1.3140-60.
Remember that we use small timeframes like H4 and H1 just to filter our entry point. You´ll do better planning your trades in higher timeframes like daily and weekly charts for more reliable support and resistance areas. I´m not telling that other style of trades like scalping and others do not run! This style of trade is what runs for me and fits me best. You have to make good use of demonstration accounts and test your strategy and most important, yourself regardless the timeframe in order to find your trade style. If it produce good results for you, excellent! If not, well, this is the purpose of keeping good records of your trades. Study it and see what you´re doing wrong finding the courage and determination to change.
Thank you for reading folks and maybe we can fish some green pips this week!