FX.co ★ Analysis and trading tips for EUR/USD on July 6

Analysis of transactions and tips for trading EUR/USD

Further growth became limited as the test of 1.0896 on Wednesday afternoon coincided with the sharp rise of the MACD line from zero. The second test, meanwhile, occurred when the MACD line hit the overbought area, providing an excellent entry point to sell the pair. This resulted in euro dropping in price by around 30 pips.

Disappointing PMI data from the eurozone dragged the pair down. However, it may recover today after the release of reports on the volume of orders in Germany and volume of retail trade in the eurozone. The speech of ECB board member Joachim Nagel may also lead to a rally, as his statements may be about future interest rates. Even so, demand will not be very high until the ADP publishes its employment reports in the afternoon.

For long positions:

Buy when euro hits 1.0864 (green line on the chart) and take profit at the price of 1.0902. Only good retail sales data in the eurozone will trigger growth in the pair.

When buying, traders should make sure that the MACD line lies above zero or rises from it. Euro can also be bought after two consecutive price tests of 1.0836, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0864 and 1.0902.

For short positions:

Sell when euro reaches 1.0836 (red line on the chart) and take profit at the price of 1.0800. Pressure will increase after weak data for Germany and the eurozone

When selling, traders should make sure that the MACD line lies below zero or drops down from it. Euro can also be sold after two consecutive price tests of 1.0864, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0836 and 1.0800.

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.