Analysis of transactions in the EUR / USD pair
Markets are anticipating the inflation report for the Euro area because a rise beyond 10.0% will put even more pressure on euro. But in the longer term, this is favorable, as it will force the European Central Bank to stick to its plan to tighten monetary policy, which will make euro more attractive after all the hype around the global recession subsides, and the world's central banks begin to conduct a more accommodating monetary policy.
Data on the US real estate market is also due, as well as the volume of building permits issued and new foundations laid. A decline in these indicators will return pressure on dollar. The speech of FOMC member Neel Kashkari is unlikely to affect the markets.
For long positions:
Buy euro when the quote reaches 0.9845 (green line on the chart) and take profit at the price of 0.9886. Growth is likely to occur after the release of inflation data in the Eurozone.
Take note that when buying, the MACD line should be above zero or is starting to rise from it. Euro can also be bought at 0.9817, but the MACD line should be in the oversold area as only by that will the market reverse to 0.9845 and 0.9886.
For short positions:
Sell euro when the quote reaches 0.9817 (red line on the chart) and take profit at the price of 0.9774. Pressure will intensify if there is no bullish reaction to the inflation report in the euro area and strong data on the US real estate market.
Take note that when selling, the MACD line should be below zero or is starting to move down from it. Euro can also be sold at 0.9845, but the MACD line should be in the overbought area as only by that will the market reverse to 0.9817 and 0.9774.
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 decision based on the current market situation is an inherently losing strategy for an intraday trader.