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FX.co ★ EUR/USD: Simple trading tips for novice traders on May 31st (US session)

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Forex Analysis:::2024-05-31T13:47:20

EUR/USD: Simple trading tips for novice traders on May 31st (US session)

Analysis of transactions and tips on trading the European currency

The price test of 1.0825 came at a time when the MACD indicator was starting to move up from zero, confirming the correct entry point for the purchase. As a result, the pair rose smoothly by more than 30 points without the slightest correction. The euro sellers may dictate the second half of the day, as important data related to American inflation are expected. The main index of personal consumption expenditures – the Fed's preferred measure of inflation – may show growth, leading to a sharp drop in the euro and a strengthening of the US dollar. It is also worth paying attention to the figures on changes in the level of income of the population, changes in the level of spending of the population, and the Chicago PMI index. Good indicators are a reason to sell euros properly at the end of the month. As for the intraday strategy, I plan to act based on implementing scenarios No. 1 and No. 2.

EUR/USD: Simple trading tips for novice traders on May 31st (US session)

Buy signal

Scenario No. 1: today, I plan to buy euros when the price reaches 1.0871 (the green line on the chart) to grow to 1.0914. At 1.0914, I will exit the market and sell euros in the opposite direction, counting on a movement of 30-35 points from the entry point. The upward movement of the euro today can be counted only after the news about decreased personal consumption expenditures in the United States. Important! Before buying, ensure the MACD indicator is above the zero mark and is just starting to grow from it.

Scenario No. 2: I also plan to buy euros today for two consecutive price tests of 1.0845, when the MACD indicator will be in the oversold area. This will limit the pair's downward potential and lead to a reverse upward market reversal. We can expect an increase to the opposite levels of 1.0871 and 1.0914.

Sell signal

Scenario No. 1: I will sell euros after reaching the level of 1.0845 (the red line on the chart). The target will be the 1.0812 level. I plan to exit the market and buy euros immediately in the opposite direction (counting on a movement of 20-25 points in the opposite direction from the level). The pressure on the pair will return in case of unsuccessful buyer activity in the area of the daily maximum and strong statistics in the United States. Important! Before selling, ensure the MACD indicator is below the zero mark and is just beginning to decline.

Scenario No. 2: I also plan to sell euros today in the case of two consecutive price tests of 1.0871, when the MACD indicator will be in the overbought area. This will limit the pair's upward potential and lead to a reverse downward reversal of the market. We can expect a decline to the opposite levels of 1.0845 and 1.0812.

EUR/USD: Simple trading tips for novice traders on May 31st (US session)

What's on the chart:

Thin green line is the entry price at which you can buy a trading instrument;

Thick green line is the estimated price where you can place Take profit or fix profit yourself since further growth is unlikely above this level;

Thin red line is the entry price at which a trading instrument can be sold;

Thick red line is the estimated price where you can place Take profit or fix profit yourself since further decline is unlikely below this level;

MACD indicator. When entering the market, it is important to be guided by overbought and oversold zones.

Important. Novice Forex traders need to make decisions about entering the market very carefully. Before releasing important fundamental reports, it is best to stay out of the market to avoid sharp fluctuations in the exchange rate. If you decide to trade during the news release, always place stop orders to minimize losses. You must place stop orders to lose your entire deposit quickly, especially if you do not use money management but trade in large volumes.

Remember that a clear trading plan, following the example I presented above, is necessary for successful trading. Spontaneous trading decision-making based on the current market situation is an inherently losing strategy for an intraday trader.

Analyst InstaForex
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