Overview of trading and tips on EUR/USD
The price test of 1.0777 occurred at a time when the MACD indicator was far from the zero mark. However, I mentioned that I would act regardless of the indicator's readings since the entire calculation was based on a strong movement following the release of data. As a result, traders could gain over 60 pips if they bought the euro at 1.0777. The outcome of yesterday's Federal Reserve meeting was quite expected. The FOMC revised its stance to a more hawkish one despite US inflation decreasing for the second consecutive month. This indicates a longer wait-and-see stance and a later interest rate cut this year – if it happens at all. For this reason, the US dollar should not be written off just yet and the bullish market is not going anywhere.
This morning, traders can look to the release of the Eurozone industrial production, Italy's quarterly unemployment rate, Spain's Consumer Price Index, and Germany's wholesale prices. However, traders don't consider these as important macroeconomic indicators, so we may struggle to determine the pair's direction today. As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and 2.
Buy signals
Scenario No 1. Today, you can buy the euro when the price reaches 1.0815 plotted by the green line on the chart, aiming for growth to the level of 1.0857. At the level of 1.0857, I plan to exit the market and also sell the euro in the opposite direction, counting on a movement of 30-35 pips from the entry point. You can count on the euro to rise today in continuation of yesterday's trend, but the bulls need to become more active in the first half of the day. Before buying, make sure that the MACD indicator is above the zero mark and is just starting to rise from it.
Scenario No 2. I am also going to buy the euro today in case of two consecutive tests of the price of 1.0797 at the time when the MACD indicator is in the oversold area. This will limit the downward potential of the instrument and lead to an upward reversal of the market. We can expect growth to the opposite levels of 1.0815 and 1.0857.
Sell signals
Scenario No 1. I plan to sell the euro after EUR/USD reaches the level of 1.0797 plotted by the red line on the chart. The target will be the level of 1.0765, where I am going to exit the market and buy immediately in the opposite direction (expecting a movement of 20-25 pips in the upward direction from the level). Pressure on EUR/USD will increase in case the price fails to consolidate near the daily high. Before selling, make sure that the MACD indicator is below the zero mark and is just starting to decline from it.
Scenario No 2. I am also going to sell the euro today in case of two consecutive price tests of 1.0815 at the time when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward reversal of the market. We can expect a decline to the opposite level of 1.0797 and 1.0765.
What's on the chart:
The thin green line is the entry price at which you can buy the trading instrument.
The thick green line is the price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
The thin red line is the entry price at which you can sell the trading instrument.
The thick red line is the 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 in the cryptocurrency market need to be very cautious when making decisions to enter the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you don't use money management and trade with large volumes.
Remember, for successful trading, it is necessary to have a clear trading plan, similar to the one I presented above. Spontaneously making trading decisions based on the current market situation is inherently a losing strategy for an intraday trader.
