FX.co ★ Analysis and trading tips for EUR/USD on January 12

Analysis of transactions in the EUR / USD pair

No entry points appeared in the market yesterday because volatility was low, which was primarily caused by the lack of statistics in both the Euro area and the US.

Markets remained balanced on Wednesday as players ignored the data on Germany and US 10-year treasury yields. Most likely, this scenario will continue today because only an economic bulletin from the European Central Bank is expected. The report will keep trading within the horizontal channel, albeit with a slight tilt downwards before the release of the US CPI data in the afternoon. The December figures are projected to show a slowdown, which will result in a decrease in demand for the dollar and accordingly, a rise in EUR/USD. The speech of FOMC member Patrick Harker and the weekly US jobless claims data will not be of much interest.

For long positions:

Buy euro when the quote reaches 1.0776 (green line on the chart) and take profit at the price of 1.0821. Although there is a chance for growth today, traders should be very careful and wait for the US inflation report before buying. Also, make sure that the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0737, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.0776 and 1.0821.

For short positions:

Sell euro when the quote reaches 1.0737 (red line on the chart) and take profit at the price of 1.0685. Pressure will return if data shows that inflation in the US continues to increase. But take note that when selling, the MACD line should be below zero or is starting to move down from it. Euro can also be sold at 1.0776, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.0737 and 1.0685.

What's on the chart:

The thin green line is the key level at which you can place long positions in the EUR/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the EUR/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

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.