Analysis of transactions in the EUR / USD pair
The test of 1.0283 happened when the MACD line went down quite a lot from zero, which limited the downside potential of the pair. Some time later, another test took place, but this time the MACD line was in the oversold area, which was a good reason to buy. This resulted in a price increase of over 40 pips. As for long positions at 1.0325, they did not bring much success.
Industrial output of the Euro area, as well as the speeches of ECB representatives, did not affect the market in any way. This allowed buyers to hold their positions.
Today, much will depend on the data on business sentiment in Germany and the whole eurozone, which, if shows a decrease, will certainly hit euro. Meanwhile, the 3rd quarter GDP and foreign trade balance in the Euro area will be of little interest. In the afternoon, there will be reports on the US producer price index and the manufacturing index, but investors are unlikely to take the figures seriously. Thus, it is advised to focus more on the speeches of FOMC members Lisa Cook and Michael Barr.
For long positions:
Buy euro when the quote reaches 1.0356 (green line on the chart) and take profit at the price of 1.0404. Growth could occur, but there needs to be good statistics for the eurozone, indicating that the normal pace of economic growth is maintained. Also, remember that when buying, the MACD line should be above zero or is starting to rise from it.
Euro can also be bought at 1.0316, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.0356 and 1.0404.
For short positions:
Sell euro when the quote reaches 1.0316 (red line on the chart) and take profit at the price of 1.0275. Pressure will return after unsuccessful consolidation above monthly highs and weak reports on the eurozone. Take note that when selling, the MACD line should be below zero or is starting to move down from it.
Euro can also be sold at 1.0356, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.0316 and 1.0275.
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.
