Instrument: EURUSD
Trade Type: Short
Timeframe: [4HR]
Entry Price: [1.10673]
Stop Loss (SL): [1.10838]
Take Profit (TP): [Trailing]
Risk-Reward Ratio: Unknown
Outcome: No execution
Entry Analysis:
I’m looking for a sell trade on EUR/USD as the price is anticipated to pull back to a recently broken resistance level, which aligns with the 0.618 Fibonacci retracement—creating a strong confluence zone. A retest at this level could signal a continuation of the downtrend, especially with the strengthening US dollar since last Friday due to higher inflation expectations and speculation that the Federal Reserve may extend its tightening policies. Today's inflation data release could further boost the dollar, adding to the bearish sentiment for EUR/USD.
Outcome:
Today's trade on EUR/USD didn't play out as expected. I was looking for a pullback to a key resistance level before the release of US inflation and CPI data today, but the pair failed to retrace and instead broke down through support. The stronger-than-expected CPI data, which showed core inflation remaining above target despite overall CPI cooling, boosted the US dollar. This reinforced expectations that the Federal Reserve might keep interest rates elevated longer to manage inflation, strengthening the dollar further and leading to the sell-off in EUR/USD. Although my entry aligned with my strategy, the market momentum shifted after the data release, resulting in a missed opportunity.
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