I've decided to exit the second half of my EUR/USD short because we've got a nice long signal on the daily chart.  Usually I wait to exit profitable positions by relying on my trailing stop to take me out, but the action on the daily is telling me that this pair will rise.  Of course, I could be wrong!

Today we see a nice pin bar forming on the EUR/USD daily chart.  What do I like about this pin bar?

1. It exists within a clear trend.  The medium-term trend is down, and if the pin bar holds, it will signal the end of that trend.
2. The longer-term trend on the daily chart is up, and the pin bar suggests that the pair will resume its prevailing trend.
3. Its nose extends well beyond any recent lows and "sticks out."
4. The pin bar is bouncing off of an area of confluence.  There's an area of support that has been tested in the recent past as both support and resistance indicated in the chart below by the two horizontal dotted lines.  Also, the bottom tip of the pin bar touches the 61.8 Fib level off of the low on 11/21/08 perfectly (I generally don't pay too much attention to Fibs, but I keep them in the back of my mind and will look at them occasionally since so many people use them).

So, for my Euro short position, I bank 213.8 pips on the first half and 293.9 pips on the second half.

I'll enter a long order just above the top of the pin bar and catch it on its way up if the pattern holds.

• Long Entry:  1.3667
• Initial Stoploss:  1.3485