November 17, 2008 04:34

Forex Signals – EUR/USD Gap Trade; Selling Rallies

By:

11-17-08

3:26a GMT – In my forex signal from Friday of last week I said that there were mixed signals, but that I trusted the flagpole signal more than the trend resistance so if you were an aggressive trader I would go long. I ended with this advice: “As we approach the weekend however, no trade at all might be the best trade for now :) [due to the mixed signals].”

Well I hoped you listened to that advice as we opened the trading this week with a huge gap lower after the pair bounced hard off the trend resistance (yellow line below). This reinforces the downward trend of the pair and I am now looking to sell rallies, preferably around the yellow resistance line below.

Trading Idea: Resistance to look for a bearish reversal signal at for the short trade – 1.2600, 1.2715 and 1.2775. Short targets should fall down to 1.2505 and 1.2395 eventually.

(click to enlarge)

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