Contrary to expectations, business sentiment in both Germany and the eurozone deteriorated in March this year. However, this did not prevent buyers from recovering all of yesterday's losses in an attempt to regain initiative and control over the market. As for signals, the test of 1.0956 occurred when the MACD line was far above zero, which limited the upside potential of the pair. The market may also be bearish in the afternoon unless upcoming US data disappoints. Thus, traders should pay close attention to the reports on issued building permits and new housing starts, as well as on the speech of Fed representative Michelle Bowman.
For long positions:
Buy euro when the price hits 1.0993 (green line on the chart) and then take-profit when the quote reaches the level of 1.1030. Weak data on the real estate market will weaken dollar's position. However, before buying, make sure that the MACD line is above zero and is starting to rise from it.
Euro can also be bought at 1.0961, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0993 and 1.1030.
For short positions:
Sell euro when the price reaches 1.0961 (red line on the chart) and take-profit at the level of 1.0926. Strong US data will put pressure back on the pair. However, before selling, make sure that the MACD line is below zero and is starting to drop down from it.
Euro can also be sold at 1.0993, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0961 and 1.0926.
What's on the chart:
Thin green line - entry price at which you can buy EUR/USD
Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which you can sell EUR/USD
Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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.
