EUR/USD
No trade setup on EUR yesterday, there was a bearish cs at 06h00 GMT but was not according to the system, price fell dramatically and took out the B low at 3607 giving us a new AB swing with A up at 3867, also confirming the bigger reversal on the 4h chart.
FOR TODAY:
We need a rally and a bearish cs formation, ideally around 3600-3650, if we get a bearish cs formation trade it short.
Else we will be looking for bullish cs formations on BF786 trade setups. Remember that this will be counter trend, so be prepared for bearish reversals.
SHORT: WILL ONLY BE GOING SHORT IF:
Our system only allows us to sell at the 618/786, which is higher up at 3732 and 3791 respectively. We are not expecting price to retrace all that way before we fall again, the downside has been opened by the violation of the 3607 low, so we are expecting price to accelerate to the downside.
If we get a clear bearish cs formation around the 3600-3650 area where we have past support becoming future resistance and a 382 fib level of the new AB downswing then we will short that bearish cs formation, stop above the high of the cs formation, max 1.5%, limits set at either at 100 pips, or as a ST down to 3380.
If we don’t get the cs formations we are looking for then we don’t trade.
LONG: WILL ONLY BE GOING LONG TODAY IF:
We get a BF786 trade setup and a bullish cs formation thereafter. Trade this for 80-100 pips limit since it’s a shallow bounce, but be aware of bearish cs formations. Stops below the low of the cs formation, max 1.5% risk. Remember we had a dramatic fall yesterday, and today could be resumption of the downtrend, so be aware that trading long would be counter trend.
If we don’t get the setup we are looking for then we don’t trade.
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