FX.co ★ Trading plan for EUR/USD on September 25. Simple tips for beginners

Analyzing Friday's trades:

EUR/USD on 30M chart

EUR/USD traded flat on Friday. While there might not have been many explicitly flat days recently, there have been plenty of days with very low volatility. Friday was no exception, as the price moved within a range of just over 50 pips from the day's low to the high, so it was quite inconvenient to trade. A total of 9 business activity indexes were published in the European Union, Germany, and the United States. Instead of delving into each one separately, we can sum it up saying that the European and German PMIs were slightly more disappointing than the American ones.

Therefore, if the euro had the chance to rise on Friday, let's just say it quickly dissipated, and the price stayed near its local lows. As a result, the downtrend persists, and the pair may still try to correct higher, but in the medium term, we are likely to see downward movement.

EUR/USD on 5M chart

You can clearly see the nature of the movement on the 5-minute chart. The first and only sell signal occurred during the US trading session when the price bounced off the level of 1.0673. It's a point of contention whether it was worth trading while the pair was flat or just a few hours before the market closed on Friday. If beginners decided to proceed under such conditions, they probably earned 10-20 pips at best. The rebound from the level of 1.0618 doesn't count because at that time, the level of 1.0618 did not exist; in fact, it's a new level.

Trading tips on Monday:

On the 30-minute chart, we can see that the weak upward movement may be part of the correction, but in general, the euro still lacks robust bullish indicators. In the medium term, we anticipate the euro's further decline, but the pair could still correct higher since corrections are a natural part of the market. The key levels on the 5M chart are 1.0517-1.0533, 1.0607-1.0613-1.0618, 1.0673, 1.0733, 1.0767-1.0781, 1.0835, 1.0871, 1.0901-1.0904. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Monday, there are no significant reports lined up in either the European Union or the United States. The only noteworthy event is the speech by European Central Bank President Christine Lagarde. However, she probably won't provide any new information since she has already spoken several times in the last 10 days.

Basic trading rules:

1) The strength of the signal depends on the time period during which the signal was formed (a rebound or a break). The shorter this period, the stronger the signal.

2) If two or more trades were opened at some level following false signals, i.e. those signals that did not lead the price to Take Profit level or the nearest target levels, then any consequent signals near this level should be ignored.

3) During the flat trend, any currency pair may form a lot of false signals or do not produce any signals at all. In any case, the flat trend is not the best condition for trading.

4) Trades are opened in the time period between the beginning of the European session and until the middle of the American one when all deals should be closed manually.

5) We can pay attention to the MACD signals in the 30M time frame only if there is good volatility and a definite trend confirmed by a trend line or a trend channel.

6) If two key levels are too close to each other (about 5-15 pips), then this is a support or resistance area.

How to read charts:

Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.

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

MACD indicator (14,22,3) is a histogram and a signal line showing when it is better to enter the market when they cross. This indicator is better to be used in combination with trend channels or trend lines.

Important speeches and reports that are always reflected in the economic calendars can greatly influence the movement of a currency pair. Therefore, during such events, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners should remember that every trade cannot be profitable. The development of a reliable strategy and money management are the key to success in trading over a long period of time.