Trading ideas: EUR/USD bounce in progress, long at 1.1350

Wojciech Matysiak MyFXspot.com

The USD ended little changed on Wednesday after reaching a 13-month peak against a basket of currencies. Upbeat figures on U.S. retail sales, manufacturing output and worker productivity supported the greenback and the view of steady U.S. economic growth. But USD sell-off during the North American session suggests a corrective move is due. We opened EUR/USD long at 1.1350 yesterday and today's price action confirms our bullish view.

This is how MyFXspot.com trades now:
EUR/USD
Trading strategy: Long
Open: 1.1350
Target: 1.1520
Stop-loss: 1.1270
Recommended size: 1.88 mini lots per $10,000 in your account
Short analysis: The long lower wick on Wednesday's daily candle suggests a bounce is due. We opened EUR/USD long at 1.1350 today.

GBP/USD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: We could see fading bearish momentum on Wednesday, which improves chances for rebound. The nearest resistance levels are 1.2750 (pivot point) and 10-day MA at 1.2857. We stand aside for now.

USD/JPY
Trading strategy: Short
Open: 111.40
Target: 109.40
Stop-loss: 112.40
Recommended size: 1.66 mini lots per $10,000 in your account
Short analysis: Prices thrown lower after running into the 21- and 30-day MAs by the 111.44 high. We opened a short position at 111.40, as previously assumed. A close below 110.65, 50% of the 108.12-113.18 rise, would put in play Thursday's 110.37 cloud base, the 61.8% at 110.05 and converging 100- and 200-day moving averages by 109.90.

USD/CAD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: The USD/CAD peeks above falling daily cloud top, before moving back within the cloud. We do not see clear signals now. Canada's July inflation report is due on Friday.

AUD/USD
Trading strategy: Await signal
Open: -
Target: -
Stop-loss: -
Recommended size: -
Short analysis: Pair sets a new long-term low and monthly RSI is biased down to keep overall sentiment bearish. The long lower wick on the daily candle suggests a bounce is due. We will probably sell the bounce, but stay aside for now.

EUR/GBP
Trading strategy: Long
Open: 0.8935
Target: 0.9050
Stop-loss: 0.8880
Recommended size: 2.15 mini lots per $10,000 in your account
Short analysis: Profit taken on EUR/USD short at 0.8910, earned: 100 pips, $395 per $10,000 in your account. We think the corrective downward move is done. We opened a long position at 0.8935 now with the target at 0.9050.

Author

Wojciech Matysiak

MyFXspot.com

Wojciech Matysiak is a chief editor and chief economist of MyFXspot.com, currency market analyst and strategies provider.

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