Looks like the EUR/USD gaped up when opening this week. This calls for a need of extra confirmation before entering this trade.
From a technical perspective, the EUR/USD 0.30% ran into a strong area of resistance where sellers came in strong in the past. On our higher time-frame (4H), we can notice the EUR/USD 0.30% putting in an ascending triangle pattern coming in from a downtrend.
We will enter this trade upon having extra confirmation that the resistance zone holds and upon seeing buyers fail. We need at least some clues that tell us the market isn't putting any new higher highs and higher lows before looking to enter.
Risk-management opportunities for this setup are plentiful. Our trading plan specifically states that we will be sizing into this trade once price breaks below 1.07600 while trailing our stop above break-even. We have to be careful how we will be sizing in since our trail-stop placement still has to make sense from a technical perspective.
One can also shoot for extended targets once full position size has been achieved and stops trailed above break-even for a risk-free trade.
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Apparently, this is a pure dollar play. Trump's failed healthcare act pushes dollar lower, resulting in a higher EUR/USD. We might not get our entry signal on this trade.