FX.co ★ Analysis and trading tips for EUR/USD on May 11

Analysis of transactions and tips for trading EUR/USD

The test of 1.0965 happened when the MACD line had just started to move below zero, which was a good reason to sell. Accordingly, there was a price decrease of about 20 pips. No other market signal appeared for the rest of the day.

CPI data from Germany and speeches from Bundesbank representatives did not lead to noticeable market changes. Even the reaction over the declining US inflation was short-lived. As for today, the economic calendar in the euro area is empty, so focus will be on the speech of ECB Executive Board member Isabel Schnabel. But much more interesting is the US jobless claims report and producer price index. The speech of FOMC member Christopher Waller may also strengthen dollar.

For long positions:

Buy euro when the level of 1.0985 (green line on the chart) is reached and then take profit at the price of 1.1015. Growth will be seen, but only in the morning. 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 1.0965, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0985 and 1.1015.

For short positions:

Sell euro when the level of 1.0965 (red line on the chart) is reached and then take profit at the price of 1.0935. Pressure will return if there is weak buyer activity and strong US labor market 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 1.0985, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0965 and 1.0935.

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.