EUR/USD weekly target at 1.2150 met the daily trade downside target at 1.2129. A good example how to trade weekly and daily targets simultaneously. From week’s start and knowing 1.2150 as the target, all day trades were short. Short trades for EUR/USD as of this morning amounted to 8 trades at twice daily in order to trade continuously. Day trades assist for extra pips during the week while waiting for targets to achieve destination.
While the weekly target was 1.2150, the downside target for this morning’s day trade was 1.2129. EUR/USD’s weekly trade by this morning was already running +90 pips at the 1.2150 target and oversold.
Was the option to exit at 1.2150 , take profits and walk away or exit at 1.2150 and enter a new trade short for an extra 21 pips. The smart approach was exit at 1.2150 as the day trade this morning was running +60 ish pips and this doesn’t include all previous day trades. How much did 21 pip matter for an extra trade. It doesn’t and no perfect guarantee to 1.2129 to trade especially when 1.2155 matched to DXY vital point at 90.24. A point that held for 2 straight days.
DXY
As written this morning, 90.24 had to break to target 90.51 and once EUR/USD broke below 1.2155 then DXY 90.24 broke higher and DXY achieved target at 90.51. DXY remains above 90.24 and explains why EUR/USD sits at 1.2120 lows without movement.
DXY 90.24 was also the green light for USD/CAD and USD/JPY to trade to day trade highs at 1.2112 and 110.35. DXY is clearly a vital indicator and insight to all currency pairs.
DXY next vital points are located at 91.57 and 92.89 while EUR/USD to trade lower must break 1.2106. AUD/USD already broke its point at 0.7703 and NZD/USD at 0.7188. USD/CHF remains below important 0.9053. And waiting on slow mover GBP/USD to comply with the universe to break 1.3963.
Until the China open, EUR/USD contains a range from 1.2060 to 1.2183 while DXY ranges from 90.03 to 90.95.
Brian Twomey
BRIAN TWOMEY ON TRADING 