EUR/USD 18 OCTOBER 2011

EUR/USD

Price gave us the BF trade setup we were looking for yesterday, but the stop was too big for the trade. Price went on to fall down to the 786 of the AB swing and bounced off it during the Asian session.

FOR TODAY:

With the bounce off the 786 during the Asian session we can expect price to either test the 786 again and give us a bullish cs formation, or we can rally from current levels towards the BF786, or lastly we can get a rally and a bearish cs formation looking to take out the A low.

SHORT: WILL ONLY BE GOING SHORT IF:

Price rallies to the BF786 and then gives us a bearish cs formation. This entry will be a ST to the A low since we would have had a 786 bounce. Stops will be above the cs formation, max 50 pips

If we don’t get the cs formations we are looking for at the fib levels then we don’t trade.

LONG: WILL ONLY BE GOING LONG TODAY IF:

Price tests the 786 and we get another bullish cs formation telling us that we are heading higher up towards the BF786. Trade this as a ST with limits set at the BF786, stops below the low of the cs formation, max 50 pips.

If we don’t get the setup we are looking for then we don’t trade.