Counter-Trend Scalping Plan For The EUR/USD - Forex News by FX Leaders

Counter-Trend Scalping Plan For The EUR/USD

Posted Wednesday, March 28, 2018 by
Shain Vernier • 1 min read

The EUR/USD has broken to the bear amid the strong U.S. GDP release. Price has fallen precipitously and as of this writing is rotating near the 1.2350 handle. A test and short-term rejection of downside support on the daily timeframe has been the story for this morning’s session.

Moving forward, the 38% intraday retracement of the U.S. GDP move at 1.2362 is the primary indicator of trend validity. As long as this level remains intact, the downtrend will be technically valid.

EUR/USD Technical Outlook

It has been a significant sell-off for the EUR/USD, with price falling 50 pips from pre-GDP levels. In the event the bearish action continues, a counter-trend scalp from support will become available.

EUR/USD
EUR/USD, Daily Chart

Here are the key levels to watch for the remainder of the session:

  • Resistance(1): Intraday 38% Retracement, 1.2362
  • Support(1): Bollinger MP, 1.2339
  • Support(2): Daily SMA, 1.2323

Bottom Line: The intraday low of 1.2334 serves as a test and rejection of the Bollinger MP. If price takes out this level, long scalps from 1.2326 will become available. Using a tight 1:1 risk vs reward management plan, a profit target of 8-12 pips is optimal.

Remember, this is a counter-trend scalping play. The risk is higher due to the presence of a trend. We are looking for immediate and positive price action — if price goes negative with sustained momentum, begin looking for the door!

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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