he EURUSD -0.78% has being in a bullish trend since December 25 2016 (based on the Weekly tf) and the trend should resume albeit the temporary sell off as shown on the 4hr tf.
For the 4hr tf, I have shown the evolution of the trendline for price action with Trendline 1 being the major trendline , while Trendline 2 is a more recent and steeper trendline . Trendline 1 is therefore stronger than Trendline 2.
I have marked 3 areas in light green where the market offers support for the EURUSD -0.78%
The actual number derived based on price projection (y axis) for the different support areas are given below:
floor 1: 1.23906 and 1.23960
floor 2: 1.23561 and 1.23599 (this intersects Trendline 2 so it is does offer a strong support for the EURUSD -0.78% )
floor 3: 1.22977 and 1.22959 (This intersects Trendline 1 so I will consider floor 3 stronger than floor 2)
If EURUSD -0.78% breaks via floor 1 then look for floor 2 to possibly provide support and if it doesn't then floor 3.
I have also marked Ceiling 1 and Ceiling 2 on the chart. These are resistance areas for the EURUSD -0.78% and the range for each "ceiling" is given below.
Ceiling 1: 1.24874 and 1.24894
Ceiling 2: 1.25326 and 1.25329
P.S. Ceiling 3: ( I could not mark this on the chart as it is still a bit far away): 1.26107 and 1.26225
Most conservative trade: Wait for price action to move above the most recent high (i.e. 1.25568) and buy the BREAKOUT!. Your take profit area would be 1.26107 (the lower range of Ceiling 3). Your SL will be calculated based on how much you are willing to risk on the trade for this set up.Generally anything that offers a risk/reward of >3:1 is good.
Slightly Aggressive approach If price attempts to break above 1.24603 and then SL will be just under the lower range of floor 1: E.g. 1.23877
MOST Aggressive approach BUY as soon as the market opens and put your SL just below the lower range of floor 2. So maybe 1.23531
I like using 3 Moving averages and my personal preference is for the 40 EMA , 21 EMA and 9EMA. I use the slope of these 3 EMA's a a great way to also determine the trend. Currently, all 3 Moving averages have a rising slope so there is no reason to believe that the bullish trend in the EURUSD -0.78% is over. A close in price action below Trendline 2 and also the 3 EMA's having a negative slope would make me REALLY consider my bullish bias for the EURUSD -0.78% . If not, the EURUSD -0.78% should remain bullish .
Disclaimer: The chart or comments should not be considered a buy, sell or trade recommendation. These are my own opinions and is for informational purposes ONLY