How to trade EUR/USD on January 17. Simple trading tips and analysis for beginners

On Monday, EUR/USD failed to cross 1.0867 and also fell below the ascending trend line, which was formed only yesterday. However, the trend line has another important function other than support. It determines where the trend may end. Unfortunately, the first attempt to fall below 1.0806 failed, so further downward movement is questionable. However, crossing this level will confirm the pair's intention to start the downward movement. We have been saying for a long time that we expect a serious correction from the euro, and we do not consider the fundamental background that allegedly supports it to be so strong that the currency would rise by 1100 in a couple of months. The market can keep buying the euro on the basis of the fundamental factors, which we mention in our main articles, but it can't go on like that forever. There were no important events on Monday, neither in the US nor in the EU, so maybe everything will be decided this week on the days when there is a background.

Almost all of Monday's trading signals were perfect in terms of accuracy. The first sell signal was formed at night, but at the opening of the European trading session, the price still moved away from the point of formation at a decent distance, so a position should not be opened. Then the pair crossed 1.0837 and fell to 1.0806. This signal should have been worked out, and it brought about 15 pips profit. Followed by a mirror buy signal, which resulted in further 15 pips gain, and the third similar signal, which gave another 15 pips profit. Even the last rebound from 1.0806 was followed by a long position, which allowed novice traders to earn about 10 pips more. Despite the fact that the pair was in a limited range for most of the day, the four deals brought beginners profit of about 55 pips, which is not bad taking into consideration the total volatility of the day of 74 pips.

The pair maintains an uptrend on the 30-minute chart, despite crossing the trend line. Now traders should wait for EUR to settle below 1.0806 in order to count on a stronger drop. There will be plenty of important events this week, but many of them might be weak in the process itself (e.g. speeches of European Central Bank President Christine Lagarde or members of the Federal Reserve). On the 5-minute chart, it is recommended to trade at the levels 1.0657-1.0668, 1.0697, 1.0736, 1.0787-1.0806, 1.0837, 1.0905, 1.0923-1.0933, 1.0966, 1.0989. As soon as the price passes 15 pips in the right direction, you should set a Stop Loss to breakeven. There are no important events or reports scheduled for Tuesday in either the EU or the US, only Germany will release its second inflation estimate for December.

1) The strength of the signal is determined by the time it took the signal to form (a rebound or a breakout of the level). The quicker it is formed, the stronger the signal is.

2) If two or more positions were opened near a certain level based on a false signal (which did not trigger a Take Profit or test the nearest target level), then all subsequent signals at this level should be ignored.

3) When trading flat, a pair can form multiple false signals or not form them at all. In any case, it is better to stop trading at the first sign of a flat movement.

4) Trades should be opened in the period between the start of the European session and the middle of the US trading hours when all positions must be closed manually.

5) You can trade using signals from the MACD indicator on the 30-minute time frame only amid strong volatility and a clear trend that should be confirmed by a trendline or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 pips), they should be considered support and resistance levels.

Support and Resistance levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Red lines are channels or trend lines that display the current trend and show in which direction it is better to trade now.

The MACD indicator (14, 22, and 3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend patterns (channels and trendlines).

Important announcements and economic reports that can be found on the economic calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommend trading as carefully as possible or exiting the market in order to avoid sharp price fluctuations.

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management is the key to success in trading over a long period of time.