FX.co ★ Analytics and trading signals for beginners. How to trade EUR/USD on February 5? Plan for opening and closing deals for Friday

Hourly chart of the EUR/USD pair

The EUR/USD pair resumed its downward movement on Thursday and Friday. The downward trend line had to be rebuilt as the price settled above it on Thursday. In the last review, we advised novice traders to trade bullish if the pair settles above the trend line. However, in reality, after this signal, the price rose by another 10 points and resumed its downward movement. And a strong movement. Thus, the buy signal turned out to be false and it should have been closed following a downward reversal of the MACD indicator. As a result, this signal brought 15 points of losses to traders. However, the quotes closed below the previous local low of 1.2003 and it signaled the resumption of the downward trend. At this point, novice traders could rebuild the downward trend line (both of its variants are shown in the chart) and open new short positions. These short positions could have been held until the MACD indicator reversed to the upside that night, but this trade would have generated 54 points and would have completely covered the losses on the first trade. Not the easiest trades in the last two days, but it was possible to get out of them with honor.

Fundamentally, Thursday was quite interesting. We have already mentioned that market participants continue to ignore the macroeconomic reports, and we even described why this is happening in our fundamental review on the euro. We recommend you read it. The fact remains. Both the US and the European Union had a sufficient number of important reports on Wednesday, but on this day the volatility of the pair decreased and traders did not react. One report on inflation in the eurozone is worth it! Its sharp rise by 1.2% was bound to provoke the euro's growth! When important reports were not released yesterday, volatility increased, and the US dollar continued to strengthen. Thus, the main conclusion to be drawn is technical factors. The EU released a report on retail sales, which was slightly worse than expected, and in the US - claims for unemployment benefits, this report was slightly better than expected. However, in general, these are completely different deviations from forecasts that should have plunged traders into shock and made them rush to buy or sell the pair. Read the second article on pound/dollar for today's macroeconomic reports.

Possible scenarios on February 5:

1) Long positions are currently irrelevant, since the price resumed the downward movement and a new downward trend line was formed. Thus, you should consider buying the pair if the price settles above the new trend line while aiming for resistance levels 1.2017 and 1.2059.

2) Trading for a fall remains relevant at the moment. However, we advise novice traders to trade bearish after the next round of correction, the MACD indicator is reset to zero and a new and strong sell signal is formed. Or if the price rebounds off a new trend line. Targets - support levels 1.1931 and 1.1903.

On the chart:

Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.

Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.

The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).

Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.