Analysis of transactions and tips for trading EUR/USD
Euro tested 1.0655 at a time when the MACD line had just started to move below zero, which was a good reason to sell. This resulted in a price decrease of over 60 pips. No other market signal appeared for the rest of the day.
Fed Chairman Jerome Powell's aggressive tone led to a massive sell-off in EUR/USD on Tuesday, which could intensify today if upcoming reports from Italy and Germany show weaker than expected numbers. A speech from ECB President Christine Lagarde and Executive Board member Fabio Panetta are also scheduled, and they are unlikely to add to market optimism. Another reason to sell is that the GDP data for Q4 2022 may be revised down.
In the afternoon, a number of important US reports are due to be released, which are likely to support dollar. There will also be another speech from Powell, so there is very little chance for euro to see a correction today.
For long positions:
Buy euro when the quote reaches 1.0561 (green line on the chart) and take profit at the price of 1.0591. Growth is unlikely today. If there is, it will only be a slight upward correction and nothing more. Nevertheless, make sure that when buying, the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0530, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0561 and 1.0591.
For short positions:
Sell euro when the quote reaches 1.0530 (red line on the chart) and take profit at the price of 1.0488. Pressure will return if the US releases a strong labor market data. However, make sure that when selling, the MACD line is under zero or is starting to move down from it. Euro can also be sold at 1.0561, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0530 and 1.0488.
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.