Analysis of transactions and tips for trading EUR/USD
Further decline became limited because the test of 1.0770 occurred during the strong downward move of the MACD line from zero. Meanwhile, purchases on the rebound at 1.0746 led to a price increase of around 20 pips.
The speeches of ECB Executive Board members Frank Elderson and Philip Lane did not help euro rise in the morning. Then, the released US labor market data dragged the pair down during the US session, but buyers quickly took advantage of this, offsetting most of the earlier decline.
Further movement will depend on the upcoming CPI data from Germany and industrial production report from Italy. Weak indicators will likely provoke another decline in euro, especially if ECB members Joachim Nagel and Piero Cipollone follow a soft stance in their speeches regarding monetary policy. If euro manages to withstand the pressure in the morning, the day may end on a positive note with an attempt to continue the upward correction.
For long positions:
Buy when euro hits 1.0780 (green line on the chart) and take profit at the price of 1.0805. Growth will only be possible with very strong eurozone statistics and firm comments from ECB representatives.
When buying, make sure that the MACD line lies above zero or rises from it. Euro can also be bought after two consecutive price tests of 1.0769, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0780 and 1.0805.
For short positions:
Sell when euro reaches 1.0769 (red line on the chart) and take profit at the price of 1.0746. Pressure on the pair will increase amid very weak macroeconomic statistics and an unsuccessful attempt to consolidate at the daily high.
When selling, make sure that the MACD line lies under zero or drops down from it. Euro can also be sold after two consecutive price tests of 1.0780, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0769 and 1.0746.
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.
