Range Trade on the EURUSD.

I have been watching the EURUSD for the past week as it makes its way from the 1.2770 levels to what seems to be the top of a range between 1.2430 and 1.3040. Today the pair finally briefly touched the roof of the range and if the range holds true, we should see a decline either today or tomorrow towards the floor of the range or at least towards the 1.2580 levels.

Another great indicator for a downturn which could also help us find the best time to enter a short trade is the trend line break or DeMark/Mouteki break.  For that we can take a look at a close view of the 4hr chart and see that a break could potentially happen in the next few candles, as it stands today that would be somewhere between 1.2900 and 1.2940.

If the range holds and the trend line is broken, we can be in this trade at the 1.2930, our stop loss can be set a little bit higher than the top of the range at around 1.3095 (165 pips risk), and our take profit can be set for 1.2650 (280 pips profit) or a trailing stop can be set when we reach that level as we can keep going to the bottom of the range to 1.2430 (500 pips profit).  

***** 12/11/08 Update *****

The EURUSD broke out of the top of the range I mentioned above at 1.3040, the pair is currently trading at 1.3250.  This price movement nullifies this range trade.  

Trade Results: no trade