Analysis of transactions and tips for trading EUR/USD
There was a test of 1.1053, but the MACD line was already far from zero, so the downward potential was limited. A little later, in the afternoon, there was another test, but this time it was at 1.1038 and the MACD line was just starting to slide down from zero. This was a good reason to sell, resulting in a price decrease of over 30 pips.
The European Central Bank's decision to raise rates by only 0.25% led to a decline in the pair as many expected a much larger increase. However, statements that hint that the rate hikes will continue in the foreseeable future helped restore market balance.
Data on industrial orders from Germany, as well as retail sales report from the eurozone, are due out today, which may influence the direction of EUR/USD. The speech of ECB Board member Frank Elderson will also be of significant importance. However, markets will focus more on the upcoming labor market data from the US, as an increase in new jobs will strengthen dollar, while data on average hourly wages will affect US inflation. The speech of FOMC member Liza Cook will be of little interest.
For long positions:
Buy euro when the level of 1.1047 (green line on the chart) is reached and then take profit at the price of 1.1091. Growth will be seen if the US reports weak labor market data. However, before buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Euro can also be bought after two consecutive price tests of 1.1025, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1047 and 1.1091.
For short positions:
Sell euro when the level of 1.1025 (red line on the chart) is reached and then take profit at the price of 1.0981. Pressure will return if there is weak eurozone statistics and strong US data. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Euro can also be sold after two consecutive price tests of 1.1047, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1025 and 1.0981.
What's on the chart:
Thin green line - entry price at which you can buy EUR/USD
Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which you can sell EUR/USD
Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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.