Analysis of transactions in the EUR / USD pair
A signal to sell emerged after EUR/USD hit 1.1148. Coincidentally, the MACD line was below zero, so the pair dropped by 25 pips. No other signal appeared for the rest of the day.
EUR/USD rallied on Friday because data on US income and spending fully coincided with the forecasts. Additionally, very few people wanted to sell at the lows, so the pair bounced up during the US session.
Most likely, this bullish move will continue as upcoming reports from the Euro area could extend demand and the upward correction. Strong GDP figures from Italy and the Eurozone will fuel growth, but decline in Spain and Germany CPI could bring balance back to the market. In the afternoon, the US will publish a report on Chicago PMI, followed by a speech from FOMC member Esther George. The latter one has a high chance of stirring the market, especially if there are statements addressing monetary policy.
For long positions:
Buy euro when the quote reaches 1.1172 (green line on the chart) and take profit at the price of 1.1205. A rally is possible, but only in the morning and amid better-than-expected reports from Germany and the whole Eurozone.
But 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 1.1154, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.1172 and 1.1205.
For short positions:
Sell euro when the quote reaches 1.1154 (red line on the chart) and take profit at the price of 1.1123. Lack of bullish activity, even after strong reports from the Euro area, will lead to a decline in the pair.
But 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 1.1172, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.1154 and 1.1123.
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.
