Euro Dollar Intraday Strategy: Filtering the False Signals

[indeed-social-media sm_list=’fb,tw,li,goo,xg’ sm_template=’ism_template_3′ sm_list_align=’horizontal’ sm_display_counts=’false’ sm_display_full_name=’true’ sm_disable_mobile=1 ]

EURUSD Technical Analysis

EURUSD suffered from heavy losses following Praet dovish remarks and Fed members hawkish statements on Monday’s session. We also suspect the current weakness in EURUSD is as a result of traders adjusting their positions in the market. After studying the charts we believe the recent selling is nothing but corrective before a resumption of the uptrend.

EURUSD Daily Chart

Please click on the chart to enlarge:

EURUSD Daily Chart 22/09/15

EURUSD Daily Chart 22/09/15

EURUSD has painted a reversed Head-And-Shoulders (H&S) on the daily chart. While the grey line marks the potential downtrend it is invalidated by the reversal pattern that is taking place at the time of this writing. This is a firm support level (lower black line) that is currently able to sustain Euro Dollar and prevent a deeper retracement in the market.

EURUSD 4hr Chart

Please click on the chart to enlarge:

EURUSD 4hr Chart 22/09/15

EURUSD 4hr Chart 22/09/15

On the 4hr chart you may see that the price is currently testing the support level that we displayed on the daily chart. Although we have updated you that that the market is filled with false signals we are relying on the daily chart, which often acts as a filter to false signals on an intraday level. 1.1090 is the latter support level where technical traders may layer their stops beneath. Their are multiple targets for the long trade aside the upper end the H&S neckline on the daily chart that we have highlighted on the chart.

Economic data from China and Wednesday’s PMI data are likely to be the key fundamental triggers for EURUSD trading strategy.

24/09/15 UPDATE: We are pleased with EURUSD progress based on our intraday strategy.

Please click on the chart to enlarge:

EURUSD 4hr Chart 24/09/15

EURUSD 4hr Chart 24/09/15

Please note the market took out a EUR 1.3 billion option that was layered at 1.2000 and another option at 1.1215 of EUR 963 million. The last move higher (which targeted those options) missed our initial target by +2.5 pips.

Last Updated on October 1, 2015