FX.co ★ Analysis and trading tips for EUR/USD on January 8

Analysis of transactions and tips for trading EUR/USD

The test of 1.0904 happened during the downward move of the MACD line from zero, provoking a sell signal. However, a sharp price decrease did not occur, resulting in losses. Purchases at 1.0934, on the other hand, coincided with the rise of the MACD line from zero, causing a buy signal. This led to an upward movement of as much as 40 pips.

A rise in the eurozone's CPI data kept euro afloat last Friday, while weak figures on US service sector activity from the ISM negatively affected dollar's positions. Today, reports on Germany's industrial order volumes and external trade balance will come out, followed by data on investor confidence and retail sales from the eurozone. Strong indicators will be another reason to buy EUR/USD.

For long positions:

Buy when euro hits 1.0957 (green line on the chart) and take profit at the price of 1.0991. Growth will occur in continuation of Friday's upward trend, supported by weak US statistics

When buying, make sure that the MACD line lies above zero or rises from it. Euro can also be bought after two consecutive price tests of 1.0931, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0957 and 1.0991.

For short positions:

Sell when euro reaches 1.0931 (red line on the chart) and take profit at the price of 1.0901. Pressure will return in the case of weak data and no bullish activity around the daily high.

When selling, make sure that the MACD line lies under zero or drops down from it. Euro can also be sold after two consecutive price tests of 1.0957, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0931 and 1.0901.

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.