Analysis of transactions in the EUR / USD pair
A signal to sell appeared in the market on Monday, but there was no downward movement because the MACD line was way below zero. A similar thing happened some time after as the indicator remained in the negative zone. No other signals appeared for the rest of the day.
Germany's wholesale price index and Italy's quarterly unemployment rate, which were released yesterday, did not affect market sentiment in any way. That is why EUR / USD traded sideways ahead of the Fed meeting this week.
Today, traders should pay attention to the October indicator of industrial production in the eurozone. If the data turns out worse than expected, demand for euro will remain low. Then, in the afternoon, the US will release its PPI report, which will determine if it is time for the Fed to seriously reduce bond purchases. The NFIB's report on small business optimism could also raise demand for dollar up.
For long positions:
Buy euro when the quote reaches 1.1291 (green line on the chart) and take profit at the price of 1.1320. Growth will be observed if industrial production in the Euro area exceeds expectations.
Before buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.1275, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.1291 and 1.1320.
For short positions:
Sell euro when the quote reaches 1.1275 (red line on the chart) and take profit at the price of 1.1238. Weak data on the eurozone economy will provoke a decline in EUR / USD.
Before selling, make sure that the MACD line is below zero, or is starting to move down from it. Euro could also be sold at 1.1291, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.1275 and 1.1238.
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.
