EURUSD: Sharp drop today from 1.1200 as pair tests fresh session low of 1.1001 this Friday morning in New York
The medium term daily candle chart below shows the price history of the Euro currency (EUR) versus the United States Dollar (USD). This currency pair is known as EURUSD, and is trading near 1.1016 around time of publication today and just off session lows - ahead of the weekend holiday that will affect certain markets this coming Monday.
Last time EURUSD was reviewed in Ideas You Can Trade a break above 1.1400 was expected to be the catalyst for a bullish continuation. However, after failing to close above 1.14 for more than two days the pair has since returned lower - with today's fall from 1.12 towards a fresh session low of 1.1001.
If support on 1.1000 holds, then a small recovery could follow, however, the trend seems to be turning bearish again and very fast, so a break-below 1.10 seems imminent and would help drive a bearish continuation. The addittional daily candle chart below shows that the medium term bearish trend could be resuming if USD strength returns.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 1.1115 with a Limit to take profit @ 1.1174 and a stop-loss @ 1.1074 Risk/Reward Summary: Limit risk = 59 pips profit / (-41) Stop-loss risk = Gain to Loss ratio = 1.43
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 1.0996 with a Limit to take profit @ 1.0945 and a stop-loss @ 1.1039 Risk/Reward Summary: Limit risk = 51 pips profit / (-43) Stop-loss risk = Gain to Loss Ratio = 1.18
Medium term daily candle chart (Zoomed-in):
Daily Candle Chart (Zoomed-out):