EUR/USD is being corrected from its rising flows. Opportunities to long EUR/USD will appear when the correction stops in the demand zone.

Hi fellow traders! EUR/USD is seen starting to move in a corrective mode on Monday, January 2nd. When this analysis is written, the Euro slipped below the 1.0600 level. That way, you can wait for opportunities to buy on dips for EUR/USD when the corrective phase stops in the demand zone.

eurusd

 

Analysis and Recommendation

Let's take a look at the following EUR/USD H1 chart below: 

eurusd 2

Based on the H1 chart above, it has been pointed out that EUR/USD is in correction toward the demand zone around 1.0550 – 1.0500. If the corrective phase ends in the demand zone, EUR/USD is expected to rise again towards the supply zone of 1.0675 – 1.0740.

Be aware if there is no bullish signal when the price is in the demand zone since the corrective phase is expected to continue to a lower demand zone around 1.0430 – 1.0375 if the 1.0500 level is crossed.

  • Therefore, set a long position at 1.0550 when the price manages to enter the demand zone and there is a bullish signal confirming it.  Stop loss may be positioned at 1.0500, while the profit target is at 1.0675.
  • Alternatively, set a short position at 1.0500 when a significant breakout signal confirms it. Stop loss may be positioned at 1.0550, while the profit target on 1.0430.

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: 1.0740, 1.0675
  • Support: 1.0550, 1.0500 (level psychological), 1.0430, 1.0375