Analysis of transactions in the EUR / USD pair
EUR / USD declined amid disappointing data on EU retail sales. And as a result of this, a sell signal appeared at 1.2011. However, it had to be ignored since the MACD line, during that time, had been in the oversold area for a long time already. There were no other signals to enter the market for the rest of the day.
Trading recommendations for February 5
Chances are, the upcoming economic reports will increase pressure on the European currency. In particular, these will be data on the volume of orders in Germany, as well as the foreign trade balance in France. To add to that, reports on the US labor market will also be released today, and they will most likely raise demand for the dollar, provided that the indicators come out much better than expected. If this happens, EUR / USD will collapse to the 18th figure.
For long positions:
Buy the euro when the quote reaches 1.1975 (green line on the chart), and then take profit around the level of 1.2019. EUR / USD will rally if there is good economic data from Germany and France. Good news on COVID-19 vaccines will also strengthen the euro.
But keep in mind that before buying, the MACD line should be above zero and is starting to rise from it.
For short positions:
Sell the euro after the quote reaches 1.1951 (red line on the chart), and then take profit at the level of 1.1907. EUR / USD will trade downwards if there is bad economic data from Germany.
Of course, before selling, it is important to make sure that the MACD line is below zero and is starting to move down from it.
What's on the chart:
The thin green line is the key level at which you can place long positions in the EUR / USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the EUR / USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
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 decisions based on the current market situation is an inherently losing strategy for an intraday trader.
Analysis of transactions in the GBP / USD pair
The Bank of England's decision to retain the current monetary policy put pound sellers into a dead end. They did this to achieve their target inflation of 2% and help maintain employment growth.
Anyhow, as a result of that, demand for the pound increased sharply, thereby creating two signals for GBP / USD. However, the first one, which is to sell at 1.3602, had to be ignored because the MACD line, at that time, was in the oversold zone. Fortunately, the second signal, which is to buy at 1.3631, was more successful, since the MACD line during that time is entering the positive zone. It enabled the pound to rise over 50 pips in the market.
Trading recommendations for February 5
The Bank of England will hold a press conference today, however, it will unlikely be about a change in monetary policy, especially on interest rates. Therefore, GBP / USD has a high chance of growing today, possibly to yearly highs. But then in the afternoon, a larger market move will take place, when reports on the US labor market are released. If the indicators come out better than expected, the pound may decline from current levels.
For long positions:
Buy the pound when the quote reaches 1.3700 (green line on the chart), and then take profit at the level of 1.3765 (thicker green line on the chart). The bull market will resume if the Bank of England retains its current monetary policy.
Keep in mind that before buying, make sure that the MACD line is above zero and is starting to rise from it.
For short positions:
Sell the pound after the quote reaches 1.3661 (red line on the chart), and then take profit at the level of 1.3597. GBP / USD will trade downwards if the Bank of England decides to impose negative interest rates.
Keep in mind that before selling, make sure that the MACD line is below zero and is starting to move down from it.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
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 decisions based on the current market situation is an inherently losing strategy for an intraday trader.
