Analysis of transactions and tips for trading EUR/USD
Further decline became limited as the first test of 1.0806 coincided with the sharp drop of the MACD line from zero. The second test, meanwhile, happened when the MACD line left the oversold area, prompting a buy signal that led to a price increase of over 40 pips.
Poor business activity data in the eurozone's service sector caused a massive sell-off in EUR/USD. However, a similar weak report from the US offset the losses, returning the balance in the market. This will likely be observed until tomorrow's speech by Fed Chairman Jerome Powell at the symposium in Jackson Hole. Euro bulls may also attempt to break out of the sideways channel due to the empty macroeconomic calendar.
For long positions:
Buy when euro hits 1.0878 (green line on the chart) and take profit at the price of 1.0909. Growth may occur in continuation of yesterday's bullish momentum. However, when buying, ensure that the MACD line lies above zero or just starts to rise from it.
Euro can also be bought after two consecutive price tests of 1.0847, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0878 and 1.0909.
For short positions:
Sell when euro reaches 1.0847 (red line on the chart) and take profit at the price of 1.0814. Pressure will increase in the event of a failed attempt to break out of the daily high. However, when selling, traders must ensure that the MACD line lies below zero or drops down from it.
Euro can also be sold after two consecutive price tests of 1.0878, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0847 and 1.0814.
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.
