EURUSD holding strong support after FOMC induced dollar rally
Yesterday I highlighted the 1.1200/20 level as one I'd be looking at taking a long from. The risk was the FOMC minutes so I left it alone over that event.
I'm undecided over taking the trade as although the support has held, the minutes were pretty hawkish which is going to keep the fire lit under the dollar. The price action today shows that we're at an impasse. Support is holding but bounces are weak.
EURUSD 15m chart
The strategy yesterday was to trade this technical level and if the FOMC didn't throw up too many surprises. That's partly changed now as the FOMC has injected extra risk. However, just because some of the parameters of the trade have changed, it doesn't mean we can't trade it but we have to adjust. I can still take a long here based on support, with the same stop just under 1.1180, and wait it out, or I can keep my money in the account and go with either a break of 1.1230 or 1.1200.
The latter means I'm not sitting in a trade treading water and waiting for a potential loss. I can let the price action be my guide. The longer the euro sits in this 30 odd pip range the more likely I'll trade a break rather than anything else.
Having a strategy is great but you must constantly assess it as markets change day to day, hour to hour. What may have worked one day may not work the next which is why we say don't marry a strategy or position.
