Analysis of transactions and tips for trading EUR/USD
The test of 1.0933 happened when the MACD line was quite far from zero, so the upward potential was limited. Sometime later, there was another test, but this time the market signal was to sell, which resulted in a price decrease of over 30 pips. A test of 1.0915 in the afternoon coincided with the start of the MACD line's downward movement, leading to a drop to 1.0895.
Traders attempted to keep euro around the daily high after France and Italy released their data on consumer prices. However, pressure returned during the afternoon, and not even a weak consumer sentiment report from the University of Michigan preserved risk appetite. There is a chance that this decline will continue today as ahead is a report on the eurozone's industrial output. Pressure could exacerbate if the indicators turn out weaker than expected. Economic forecasts from the European Commission will be equally interesting, as well as the meeting of the Eurogroup, where, in addition to key political problems, potential issues with high inflation and a reduction in lending in the region will be discussed. The speech of ECB board member Joachim Nagel can be considered important. In the afternoon, data on the Empire Manufacturing production index will be released, but much more interesting is the speech of FOMC members Raphael Bostic and Neel Kashkari. They may comment on the issue of the US debt ceiling, which will lead to the strengthening of dollar.
For long positions:
Buy euro when the level of 1.0875 (green line on the chart) is reached and then take profit at the price of 1.0912. Growth will be seen, but it will only be an upward correction. Nevertheless, 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 1.0855, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0875 and 1.0912.
For short positions:
Sell euro when the level of 1.0855 (red line on the chart) is reached and then take profit at the price of 1.0820. Pressure will return if there is strong US statistics. 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 1.0875, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0855 and 1.0820.
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.