Analysis of transactions in the EUR / USD pair
Euro bears went over their heads yesterday and pushed EUR/USD to a new monthly low. However, the chart clearly shows that after the fall during the Asian session, the MACD line was still far from zero, so sellers did not have the opportunity to take more positions. Fortunately, buyers also could not open positions because they were unprofitable.
It was the disappointing data from the Euro area that pushed the pair down yesterday. Then, in the afternoon, the price plunged deeper amid strong US statistics that supported dollar.
There is a huge chance that the pair will drop lower today because the upcoming ECB minutes may not be in favor of euro. Aside from that, in the afternoon, there will be weekly data on the US labor market and report on the volume of consumer lending, although it will not have that much impact as many investors anticipate the US Department of Labor report tomorrow.
For long positions:
Open a long position when euro reaches 1.1565 (green line on the chart) and take profit at 1.1599. There is little chance that price will increase sharply today. However, there may be a small upward correction during the publication of the ECB minutes.
In any case, before buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.1548, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.1565 and 1.1599.
For short positions:
Open a short position when euro reaches 1.1548 (red line on the chart) and take profit at 1.1510. Pressure is likely to continue because of the political risks in the US and sharp rise in EU inflationary pressures. Strong US statistics will also support dollar.
But before selling, make sure that the MACD line is below zero, or is starting to move down from it. Euro could also be sold at 1.1595, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.1548 and 1.1510.
What's on the chart:
The thin green line is the key level at which you can place long positions in the EUR / USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the EUR / USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.
Analysis of transactions in the GBP / USD pair
Wednesday's market signals were very profitable. The first one, which was to sell, coincided with the time that the MACD line was going down from zero. This allowed GBP / USD to decline by 50 pips. The signal to buy that followed provoked a 30-pip increase in the pair.
Disappointing data on the UK construction sector pushed pound down yesterday. In addition, only a few were willing to buy GBP / USD at weekly highs, so there were hardly any long positions in the market. Then, strong ADP report on the US private sector employment further limited the upside potential of the pair in the afternoon.
There are no important UK reports today so pound will have a chance to return to weekly highs. In the afternoon, weekly data on the US labor market will be released, as well as a report on the volume of consumer lending. Most likely, these reports will not have a serious impact on the market, as many investors anticipate the US Department of Labor report tomorrow.
For long positions:
Open a long position when pound reaches 1.3593 (green line on the chart) and take profit at 1.3629 (thicker green line on the chart). Price may climb up since there are no UK statistics scheduled to be released today.
But before buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.3574, however, the MACD line should be in the oversold area, as only by that will the market reverse to 1.3593 and 1.3629.
For short positions:
Open a short position when pound reaches 1.3574 (red line on the chart) and take profit at 1.3535. Pressure will return if buyers remain inactive in the market and if the US reports strong labor market data.
But before selling, make sure that the MACD line is below zero, or is starting to move down from it. The pair could also be sold at 1.3593, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.3574 and 1.3535.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP / USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP / USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.