Trade Analysis and Tips for Trading the European Currency
In the second half of the day, the test of the price at 1.0785 coincided with the moment when the MACD was just starting its upward movement from the zero mark, confirming the correct entry point to buy the euro. As a result, the pair grew by more than 20 points and hit the level of 1.0809, where I recommended selling immediately on the rebound, which brought about 15 points of profit. Weak reports on changes in German industrial production and a decrease in the annual GDP of the eurozone were ignored by traders yesterday, as positioning began on the market ahead of today's important labor market statistics in the United States. But we'll discuss this more in the day's second half. For now, let's review the report on the German Consumer Price Index and listen to what will be said at the meeting of the finance ministers of EU countries. Weak data from Germany may bring the pressure back to the euro in the first half of the day; however, upward prospects will remain until the release of US reports. As for intraday tactics, I will act in the first half of the day, relying more on the implementation of scenario No. 1.
Buy Signal
Scenario No. 1: Today, buying the euro is possible when the price reaches around 1.0793 (green line on the chart), with the target rising to 1.0825. At 1.0825, I recommend exiting the market and selling the euro in the opposite direction, expecting a movement of 30-35 points from the entry point. Counting on the rise of the euro today in the first half of the day will be possible after good figures from Germany. Important! Before buying, ensure the MACD indicator is above the zero mark and just starting to rise from it.
Scenario No. 2: Buying the euro today is also possible in the case of two consecutive price tests at 1.0770 when the MACD indicator is in the oversold zone. This will limit the downward potential of the pair and lead to a reverse market reversal. Expect growth to the opposite levels of 1.0793 and 1.0825.
Sell Signal
Scenario No. 1: Selling the euro is possible after reaching the level of 1.0770 (red line on the chart). The target will be the level of 1.0735, where I recommend exiting the market and buying the euro immediately in the opposite direction (expecting a movement of 20-25 points in the opposite direction from the level). Pressure on the pair will return in case of weak data from the eurozone and a lack of activity at the daily maximum. Important! Before selling, ensure that the MACD indicator is below the zero mark and is only starting to decline.
Scenario No. 2: Selling the euro today is also possible in the case of two consecutive price tests at 1.0793 when the MACD indicator is in the overbought zone. This will limit the upward potential of the pair and lead to a reverse market reversal downward. Expect a decline to the opposite level of 1.0770 and 1.0735.
On the Chart:
Thin green line – entry price to buy the trading instrument.
Thick green line – the expected price where you can set Take profit or independently fix profits, as further growth above this level is unlikely.
Thin red line – entry price to sell the trading instrument.
Thick red line – the expected price where you can set Take profit or independently fix profits, as further decline below this level is unlikely.
MACD indicator. When entering the market, following the overbought and oversold zones is important.
Important. Beginner traders in the forex market should be careful when making entry decisions. It is best to stay out of the market before releasing important fundamental reports to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You can quickly lose your deposit without placing stop orders, especially if you do not use money management and trade with large volumes.
Remember that you need a clear trading plan similar to the one presented above for successful trading. Spontaneous decision-making based on the current market situation is inherently a losing strategy for an intraday trader.