Analysis of transactions in the EUR / USD pair
EUR/USD hitting 1.052 prompted a sell signal in the market, however, there was no large price decrease as the MACD line was far from zero. Some time later, the pair tested the level again, but the same situation happened. It was only during the third test that the pair showed strong movement as the market signal, by then, was to buy and the MACD line was in the oversold area. The price increase was around 40 pips.
Although Germany's data on business expectations, assessment of the present situation and business climate had a negative impact on the euro, the overall trend of the market was still the same. This is because consumer expectations and sentiment in the US showed a decline, putting pressure on the dollar. US report on new home sales did not help as well.
Today, two important statistics will be released, and these are the volume of retail sales in Germany and the total number of unemployed in France. However, there is little chance that they will seriously affect the market, so focus will shift to the speech of ECB President Christine Lagarde. Her statements will help EUR/USD rally and get out of the horizontal channel that the pair has been for a little over a week. In the afternoon, the US will publish data on orders for durable goods, followed by pending sales in the real estate market. A decrease in these indicators will increase pressure on the dollar, but the market will still have low volatility.
For long positions:
Buy euro when the quote reaches 1.0569 (green line on the chart) and take profit at the price of 1.0637 (thicker green line on the chart). There is a chance for a rally today, but only after strong statistics from Germany. Also, make sure that when buying, the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0569, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0569 and 1.0637.
For short positions:
Sell euro when the quote reaches 1.0535 (red line on the chart) and take profit at the price of 1.0475. Pressure will return if Germany and France reports weak economic data and if ECB President Christine Lagarde says hawkish rhetoric regarding monetary policy. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Euro can also be sold at 1.0569, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.0535 and 1.0475.
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 decision based on the current market situation is an inherently losing strategy for an intraday trader.
