EURUSD → Second Rejection at 1.10! Short to 1.06? Let’s Answer.

EURUSD was rejected twice at the Resistance Zone and ended last week with a bear bar closing on its low! Should we short here?


How do we trade this? 🤔

EURUSD → Second Rejection at 1.10! Short to 1.06? Let's Answer.

Short answer (pun intended!), yes! My analysis from last week showed the price action around 1.078 which is right on the EMA support ribbons. Too far away from resistance to short, too far away from the Support Zone to long. The EMA ribbons themselves are support as we now can see, the price action has bounced off of them back to the Resistance Zone.

Now that we've seen a second rejection, that's our confirmation to short. The first was our signal, second our confirmation and because the bar closed on its low, we have optimal probability to enter a short position here. Target 1:2 Risk/Reward with a protective stop just above the double top at 1.10, then target the 1.06 area to take profits. Look for a bull response at the 1.06 area, a potential long opportunity using the same trade management style as this one. Refer to my analysis from last week for that setup:


EURUSD → Nearing Support! Is it Time to Long!? Let’s Answer.


Additional Note:
We're trading the Daily chart here, this trading range came after a bull channel which in isolation, should give us a long bias while we're between 1.06 and 1.10. However, zooming out to the Weekly chart shows us we're rejecting price off of the 200EMA. It's reasonable to have a short-term bull bias in this range, but caution should be used in either direction because of that Weekly 200EMA.


💡 Trade Ideas 💡

Short Entry: 1.089
🟥 Stop Loss: $0.955
✅ Take Profit: 1.057
⚖️ Risk/Reward Ratio: 1:2


🔑 Key Takeaways 🔑

1. Two Rejections at Resistance Zone, Bias to Short.
2. Second Rejection Bear Bar Closing on its Low. Run Short to 1.06 Area.
3. 1:2 Risk/Reward Ratio, Watch Out for Support at EMA Ribbons.
4. RSI at 55.00 and above Moving Average, Needs to Fall Below.
5. Also Reasonable to Scalp 1:1 and Move Stop Up to Entry.


💰 Trading Tip 💰
Probability of profit increases dramatically when you wait for what is called "confirmation" on the chart. This comes after a signal bar closes, indicating the next moves on the chart.


⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!


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