Found a pretty good retracement setup right before the ECB monetary policy decision!
If you’re like me and you’re also looking for ECB decision day setups, then you can’t have missed a possible retracement trade on EUR/USD’s 1-hour chart. Not only is the 1.3900 area a major psychological area, but it’s also near the 100 and 200 SMAs, 50% Fib zone, rising trend line, AND a previous resistance.
While analysts aren’t expecting any changes from the central bank, Draghi also has incentives to talk down the currency during his post-decision press conference. I decided to wait until after the ECB’s decision to put in my trade orders. Don’t wanna get caught in crazy volatility after all!
If the euro drops to my retracement areas, then I’ll wait for some pause or consolidation before I enter a buy trade. But if the euro pops higher or if Draghi says something bearish and that would affect their short-term decisions, then I’ll probably stay away from this uptrend trade.
What do you think of this setup? 🙂