FX.co ★ Analysis and trading tips for EUR/USD on February 6 (US session)

Analysis of transactions and trading tips on EUR/USD

The test of 1.0745 occurred during the decline of the MACD line from zero. This provoked a sell signal, which resulted in a price decrease of over 25 pips. Released data for the eurozone did not give buyers the chance to develop a correction.

Ahead lies important news, such as the economic optimism index from RCM/TIPP and the speech of FOMC member Loretta Mester. A hawkish tone will likely fuel dollar demand, leading to a decline in EUR/USD. Meanwhile, a dovish tone will open the chances for a small upward correction.

For long positions:

Buy when euro hits 1.0750 (green line on the chart) and take profit at the price of 1.0784. Strong growth will occur after weak data from the US.

When buying, ensure that the MACD line lies above zero or rises from it. Euro can also be bought after two consecutive price tests of 1.0725, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.0750 and 1.0784.

For short positions:

Sell when euro reaches 1.0725 (red line on the chart) and take profit at the price of 1.0702. Pressure will return in the case of a firm position from Fed representatives.

When selling, 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 1.0750, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0725 and 1.0702.

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.