Trade Review and Trading Advice for the Euro
A test of the 1.1725 price level occurred when the MACD indicator had already moved significantly downward from the zero line, which limited the pair's downside potential. For this reason, I did not sell the euro.
The European currency came under pressure in the first half of the day due to downward revisions of the PMI indices. The Eurozone Services PMI for December rose to 52.4 points, which turned out to be significantly lower than the November reading. Such figures raised concerns about the reliability of the Eurozone's economic recovery in the new year.
In the second half of the day, attention will shift to the release of similar economic indicators for the US. The US Services PMI and the Composite PMI are important data points for investors seeking a deeper understanding of the current state of the US economy. The services activity index is expected to show a slight increase. A stronger-than-expected reading could support the US dollar.
As for the intraday strategy, I will rely primarily on the implementation of Scenarios No. 1 and No. 2.
Buy Signal
Scenario No. 1: Today, buying the euro is possible when the price reaches the level around 1.1720 (green line on the chart), with a target of growth toward 1.1746. At the 1.1746 level, I plan to exit the market and also sell the euro in the opposite direction, aiming for a move of 30–35 points from the entry point. Strong euro growth can be expected only after weak US data.Important! Before buying, make sure that the MACD indicator is above the zero line and is just starting to rise from it.
Scenario No. 2: I also plan to buy the euro today in the event of two consecutive tests of the 1.1704 level while the MACD indicator is in oversold territory. This would limit the pair's downside potential and lead to a bullish market reversal. A rise toward the opposite levels of 1.1720 and 1.1746 can be expected.
Sell Signal
Scenario No. 1: I plan to sell the euro after the price reaches the 1.1704 level (red line on the chart). The target will be 1.1679, where I intend to exit the market and immediately open long positions in the opposite direction, aiming for a 20–25 point move from that level. Pressure on the pair may return at any moment.Important! Before selling, make sure that the MACD indicator is below the zero line and is just starting to decline from it.
Scenario No. 2: I also plan to sell the euro today in the event of two consecutive tests of the 1.1720 level while the MACD indicator is in overbought territory. This would limit the pair's upside potential and lead to a bearish market reversal. A decline toward the opposite levels of 1.1704 and 1.1679 can be expected.
What's on the Chart:
- Thin green line – entry price for buying the trading instrument;
- Thick green line – projected price where Take Profit orders can be placed or profits can be manually secured, as further growth above this level is unlikely;
- Thin red line – entry price for selling the trading instrument;
- Thick red line – projected price where Take Profit orders can be placed or profits can be manually secured, as further decline below this level is unlikely;
- MACD indicator – when entering the market, it is important to consider overbought and oversold zones.
Important. Beginner Forex traders should be extremely cautious when making market entry decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price swings. If you decide to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can very quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.
And remember, successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based solely on the current market situation are an inherently losing strategy for an intraday trader.
