EUR/USD 7 MAY 2012

EUR/USD – follow me on twitter @fxdailyforecast and stocktwits.com/fxg

No trade on Friday past since it was NFP.

FOR TODAY:

Price has broken the B support low confirming the reversal on this timeframe and giving us a new AB swing. We can only sell up at the 618/786 of this swing, or buy after a BF786 followed by a bullish cs formation – at this time we don’t have a clear swing low followed by a swing high for a BF setup.

If we don’t get the set-up we are looking for then we don’t trade.

SHORT: WILL ONLY BE GOING SHORT IF:

We need price to retrace up to the 618/786 of this AB swing, followed by confirming bearish cs formations for short entries. Place stop 13 pips above the cs formation, max 1% risk. Limits defined later.

If we don’t get the set-up we are looking for then we don’t trade.

LONG: WILL ONLY BE GOING LONG TODAY IF

We first need a swing high before price tests the BF786 and give us a bullish cs formation for a long trade setup, will wait to see if it happens in today’s sessions. Place stop 10 pips below the cs formation, max 1% risk. Limits here will be 60-70 pips since it’s a shallow bounce.

If we don’t get the set-up we are looking for then we don’t trade.