3 Forex Trade Ideas ahead of July ECB meeting


21 July, AtoZForex Once again analysis yesterday has brought us 88 pips of profit from USDJPY while the trade setup for EURUSD and GBPUSD were not triggered, make a total of 288 pips.  The following are my Forex trade ideas for 21st of July with focused on the EMEA Session ahead of the ECB July meeting. The three major pairs discussed are EURUSD, GBPUSD, and USDJPY.

EURUSD Intraday analysis

Daily Pivot: 1.1005

Bias: sell limit @ 1.1054 (R2) with targets @ 1.1029 (R1) & 1.1005 (DPP).

Alternative scenario: sell stop @ 1.1005 (DPP) with targets @ 1.0980 (S1) & 1.0956 (S2)

Comment: Looking at the Weekly and Daily timeframe, we can see that the 50% Fibonacci retracement level (1.0993) has been tested several times which is also very close to the psychological level 1.1000.

On a shorter time period, we are seeing a different tone where prices continuously rise and MACD confirms it’s short-term bullish trend. SMA 20 is already broken while SMA 100 is about to be broken.

We may see volatility before and / or during the ECB press conference later.

Due to small market movement yesterday, the Daily Pivot and Support and Resistance levels are very narrow. As this is the case, it is best to look for better opportunity where it meets your proper risk reward ratio.

EURUSD-H1 Forex Trade Idea EURUSD H1, Forex trade ideas (click to zoom in)

GBPUSD Intraday analysis

Daily Pivot: 1.3173

Bias: Buy stop @1.3241 (R1) with targets @1.3320 (76.4% Fib level) & 1.3358 (R2)

Alternative scenario: Sell stop @1.3225 (R1) with targets @ 1.3173 (DPP) & 1.3092 (S1).

Comment: Our forex trade idea uses Daily Pivots as one of the tools and as we can see the current market price has bounced off from today’s daily pivot which acts like a magnet where it pulls towards the DPP and then repels afterward. In case the Resistance (R2) level is broken, the next possible resistance is the 76.4% Fibonacci retracement.

Fundamentally, we have yet to wait for the result of Retail Sales data. One thing to note is that the forecast figures shows -0.4% compared to previous 0.9% which has a more conservative outlook. A huge deviation of the actual result with forecast figures will bring volatility to the market.

GBPUSD-H1 Forex Trade Idea GBPUSD H1, Forex trade ideas (click to zoom in)

USDJPY Intraday analysis

Daily Pivot: 106.427

Bias: sell limit @107.634 (Daily Support) with targets @ 107.025 (R1) & 106.427 (DPP)

Alternative scenario: sell stop @ 106.427 (DPP) with targets @ 106.044 (S1) & 105.557 (Daily Support)

Comment: From a daily time frame, it is noticeable that we are reaching a support level (107.634) and SMA 100 is also near. We may see this as a possible area for a rebound and it could result in continuation of the bearish trend.

Fundamentally, upon checking the JPY, CHF, and gold, we can see a broad decline in the past few days. These 3 assets are known to be safe havens, this suggests that the risk appetite in the market is high.

USDJPY-H1 Forex Trade Idea USDJPY H1, Forex trade ideas (click to zoom in)

Thursday usually is a good trading day as it brings more volatility, thus use proper risk management.

Also see: UOB daily trade ideas for Forex Traders

Think we missed something? Let us know in the comments section below.

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