The dominant bullish sentiment has encouraged EUR/USD to continue its rally. Therefore, you may look forward to open a long position in this trading scenario.

Hi fellow traders! EUR/USD is seen trying to continue the rally in the mid of the bullish trend. The increasing price is now testing the supply zone at 1.0566, hence, you can consider opening a long position after the pullback.

eurusd

 

Analysis and Recommendation

Let's take a look at the following EUR/USD H4 chart below: 

eurusd 2

Based on the H4 chart above, it has been pointed out that EUR/USD is still trying to test the supply zone 1.0566 – 1.0620. Since the bullish sentiment is dominating, the trading scenario this time is to wait for long opportunities in the demand zone 1.0438 – 1.0372. That way, it's best to stand by for a confirmation signal when the price is corrected to the demand zone.

As an alternative, a short position can only be placed when the EUR/USD correction is able to pass through the 1.0372 level. If this level is successfully penetrated, the price has the potential to continue its correction mode towards a lower demand zone. 

  • Therefore, set a long position at 1.0438 when the price manages to enter the demand zone and there is a bullish signal confirming it. Stop loss may be positioned at 1.0372, while the profit target on 1.0620.
  • Alternatively, set a short position at 1.0372 when there is a significant breakout signal confirming it. Stop loss may be positioned at 1.0438, while the profit target on 1.0271.

Keep in mind to always use risk and money management before trading! In addition, to make use of trailing stops, don't forget to exit the market as soon as you find a reversal signal!

EUR/USD key levels: 

  • Resistance: 1.0620, 1.0566
  • Support: 1.0438, 1.0372, 1.0271, 1.0197