Analysis of Deals and Trading Advice on the European Currency
The test of the price at 1.0660 in the first half of the day occurred when the MACD indicator started moving down from the zero mark, confirming the sell signal for the euro. As a result, the pair dropped by more than 20 points, constituting a significant portion of intraday volatility. The absence of statistics on the eurozone kept trading within the channel, which currently doesn't give an advantage to either side. Unfortunately, there is no data in the second half of the day, and there are no scheduled speeches by Fed representatives, which may keep trading within a sideways channel with a slight advantage for buyers, as bears may quickly lose steam. As for the intraday strategy, I will rely more on scenarios #1 and #2.
Buy Signal
Scenario #1: I plan to buy the euro when the price reaches around 1.0657 (green line on the chart) with a growth target of 1.0685. At 1.0685, I will exit the market and sell the euro in the opposite direction, expecting a movement of 30-35 points from the entry point. Today, the rise in the euro can only be expected with a small upward correction. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just starting its upward movement from it.
Scenario #2: I also plan to buy the euro today in case of two consecutive tests of the price at 1.0639, at a moment when the MACD indicator is in the oversold zone. This will limit the downside potential of the pair and lead to an upward reverse market turnaround. We can expect growth towards the opposite levels of 1.0657 and 1.0685.
Sell Signal
Scenario #1: I will sell the euro after reaching 1.0639 (red line on the chart). The target will be the level of 1.0611, where I plan to exit the market and buy 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 a lack of buyer activity around the daily minimum. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just starting its downward movement from it.
Scenario #2: I also plan to sell the euro today in case of two consecutive tests of the price at 1.0657, at a moment when the MACD indicator is in the overbought zone. This will limit the upside potential of the pair and lead to a reverse market turnaround downwards. We can expect a decline towards the opposite levels of 1.0639 and 1.0611.
On the Chart:
Thin green line - entry price, at which you can buy the trading instrument;
Thick green line - the anticipated price where you can place Take Profit or independently close the profit, as further growth above this level is unlikely;
Thin red line - entry price, at which you can sell the trading instrument;
Thick red line - the anticipated price where you can place Take Profit or independently close the profit, as further decline below this level is unlikely;
MACD indicator. When entering the market, you must guide yourself by the overbought and oversold zones.
Important. Beginner traders in the Forex market need to be very cautious when deciding to enter the market. It is best to stay out of the market before the release of important fundamental reports to avoid being caught in sharp exchange rate 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 in large volumes. Remember that for successful trading, you need to have a clear trading plan similar to the one I have presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.