Trade Analysis and Recommendations for the Euro
The price test at 1.1751 coincided with the MACD indicator just beginning to move upward from the zero line, which confirmed the validity of the buy entry point for the euro. However, after a 15-point rise, pressure on the pair returned.
A brief spike in optimism triggered by favorable German trade balance data failed to provide lasting support for the euro. As a result, after reaching a daily high, selling pressure resumed. It appears that the market is awaiting stronger drivers that could influence the euro's longer-term trajectory.
Small business sentiment, reflected in the NFIB index, and the level of consumer credit serve as intermediate indicators of the U.S. economy's health. Therefore, strong EUR/USD moves are unlikely following their release. Still, in the current environment of global instability driven by geopolitical tensions and shifting trade relations, unexpected moves can happen. The NFIB index, as a gauge of small business confidence, plays a role in evaluating growth prospects, as small businesses are a key driver of job creation and innovation. A rise in optimism generally signals intentions to invest and expand. In turn, the volume of consumer credit reflects households' willingness to borrow. An increase in borrowing can spur consumer spending but may also raise concerns over rising debt levels.
As for the intraday strategy, I will mainly rely on the execution of Scenarios #1 and #2.
Buy Signal
Scenario #1: Today, buying the euro is possible when the price reaches around 1.1757 (green line on the chart), with the target at 1.1786. At 1.1786, I plan to exit the market and also open a sell position in the opposite direction, targeting a 30–35 point move from the entry level. A strong rally in the euro is unlikely today. Important! Before buying, ensure the MACD indicator is above the zero line and just starting to rise from it.
Scenario #2: I also plan to buy the euro today if the price tests 1.1732 twice in a row while the MACD is in the oversold area. This would limit the pair's downward potential and lead to a market reversal upward. The expected targets would be 1.1757 and 1.1786.
Sell Signal
Scenario #1: I plan to sell the euro after the price reaches 1.1732 (red line on the chart). The target is 1.1703, where I will exit the market and open a buy position in the opposite direction, aiming for a 20–25 point rebound. Downward pressure on the pair is expected to persist today.Important! Before selling, ensure the MACD indicator is below the zero line and just starting to decline from it.
Scenario #2: I also plan to sell the euro today if the price tests 1.1757 twice in a row while the MACD is in the overbought area. This would limit the pair's upward potential and lead to a reversal downward. A decline to 1.1732 and 1.1703 may be expected.
Chart Explanation:
- Thin green line – entry price for long (buy) trades
- Thick green line – projected Take Profit level or suggested point to lock in profits, as further growth above this level is unlikely
- Thin red line – entry price for short (sell) trades
- Thick red line – projected Take Profit level or suggested point to lock in profits, as further decline below this level is unlikely
- MACD indicator – it's important to consider overbought and oversold zones when entering the market
Important Note: Beginner traders in the Forex market should be very cautious when making trade entry decisions. It is best to stay out of the market before the release of key economic reports to avoid sharp price swings. If you do decide to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-losses can quickly deplete your account, especially if you ignore money management and use large trade volumes.
And remember, successful trading requires a clear trading plan like the one provided above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for intraday traders.
