There are many different pairs in the forex market. EURUSD is one of the most traded currency pairs in the world. Professional traders use different trading strategies for different pairs. A perfect USDJPY trading strategy may not be appropriate for EURUSD or any other major pairs since every single currency has its own characteristics in the market.
Today we will talk about the perfect trading strategy for trading the EURUSD daily chart.
Figure: Trading the EURUSD daily chart
This is a very simple and effective trading strategy .This strategy works best with the EURUSD major pair only. Professional traders spend years of experience in developing this unique trading strategy for the EURUSD pairs.
Trading condition and entry signal
First of all the traders need to select the daily time frame on the EURUSD chart. A valid trend must be clearly present in the chart in order to trade this strategy.
Traders will then Mark the potential support and resistance zone of the market with blue rectangle shape box. It’s very important that traders consider the support and resistance level as area.
For Uptrend, traders will draw an uptrend which would the primary trend line setup. If bullish candlestick confirmation pattern is printed on the first three point of the trend line than traders will take their buy entry at the fourth point which will be the confluence of temporary support and primary trend line.
Stop loss should be placed right below the candlestick confirmation pattern. Take profit area of the trade will be set the key resistance zone.
The trader will draw a secondary trend line if they wish to use trailing stop loss for the pair. The first initial trailing stop should be placed just below the secondary trend line. If there is enough bullish momentum market will eventually break the key resistance zone and the trader will trail their stop loss right below the resistance zone to maximize their profit.