Analysis of transactions in the EUR / USD pair
A signal to buy emerged after EUR/USD hit 1.1443. However, there was no strong movement because weak statistics on the euro area limited demand for the European currency. That resulted in losses in the market.
Some time after, the pair hit 1.1419, which coincided with the MACD line being far from zero. That situation limited the downside potential of the pair.
By afternoon, the quote was at 1.1443 again, but this time it ended with a 20-pip increase in the pair.
Contrary to what was expected, reports about German industrial production and EU investor confidence did not help euro rally yesterday morning. The speech of ECB president Christine Lagarde did not affect the market as well because it did not address the central bank's monetary policy.
Today, EUR/USD may increase, but only if France and Italy post very strong growth on foreign trade balance and retail sales. Volatility may also surge in the afternoon, when the US releases data on small business optimism and foreign trade balance.
For long positions:
Buy euro when the quote reaches 1.1433 (green line on the chart) and take profit at the price of 1.1481 (thicker green line on the chart). A rally will occur if reports from the Euro area exceed expectations. 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 1.1404, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.1433 and 1.1481.
For short positions:
Sell euro when the quote reaches 1.1404 (red line on the chart) and take profit at the price of 1.1350. Be careful and cautious when selling at lows because the lower euro falls, the more demand will return to it. Also, before selling, make sure that the MACD line is below zero, or is starting to move down from it. Pound can also be sold at 1.1433, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.1404 and 1.1350.
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.
