I’m aiming for the stars, guys! In this case, my “star” is EUR/USD’s 1.2000 major psychological handle.
After all, Uncle Sam’s reports are barely supporting the FOMC’s willingness to raise its rates by another 25 points this year.
Word on the streets is that Janet Yellen will have to be explicitly hawkish in her testimony today to make believers out of the Fed’s critics.Last but not the least is the Brexit angle that has pushed EUR/GBP to highs not seen since November last year.
If you recall, the BOE’s hawkishness has been offsetting jitters over the Brexit negotiations. But now that some BOE members *cough* Broadbent *cough* are not as hawkish as the others, EUR/GBP is getting some lovin’ that’s pushing the euro higher across the board.So with the Fed’s hawkishness mostly priced in; BOE’s hawkishness under question; BOJ’s commitment to providing stimulus still undeniable and the SNB’s inclination to intervene in forex markets still solid, the euro’s safe haven status has been bumped up.
A quick look at EUR/USD’s 1-hour chart shows an upside break from a triangle, which coincides with EUR/GBP’s upside break from a mid-term consolidation.
My buy stop order got triggered at 1.1475, which is already above last week’s highs. The pair is having trouble breaking above the top WATR level that we identified earlier this week, but I’m hoping that the momentum is strong enough for another breakout.
I’m ultimately aiming for the big 1.2000, which is a major area of interest for the pair back in mid-2010 and mid-2012. Oh, and it’s also currently lining up with the 200 SMA on the weekly chart!
Here’s my plan:
Risk 0.5% of my account at 1.1475, max stop loss at 1.1225, and max PT at 1.1975 for a 2.5:1 reward-to-risk ratio.
The plan is pretty long-term, so I’ll be ready to make adjustments in case there are significant developments.
What do you think? Do you have a similar trade?
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