Analysis of Trades and Trading Tips for the Euro Currency
The price test at 1.1571 occurred when the MACD indicator had moved significantly below the zero mark, which limited the pair's downward potential. For this reason, I did not sell euros. The second test of 1.1571 led to the implementation of Scenario No. 2 to buy euros, resulting in a rise of 25 pips.
The sudden collapse in the number of jobs in the U.S. non-farm sector by 92,000 caused a sharp decline in the value of the American currency. It is clear that increases in the unemployment rate and decreases in available vacancies directly affect consumer spending. People, feeling uncertain about the future, tend to cut back on their financial expenditures, and now there is also a sharp rise in gasoline prices, which could trigger a new inflation spike in the U.S., completely negating the deflationary effect that the Fed has been striving for in recent years.
Today will mark the publication of several important economic indicators for Germany and the Eurozone. Reports on the dynamics of orders in German industry and data on industrial production volumes are expected to be released. Additionally, the Sentix investor sentiment indicator for the Eurozone will be presented. It is anticipated that these figures will reflect weak activity in the manufacturing sector, historically a driver of the country's economic growth. Significant deviations from forecasts could have a noticeable impact on the value of the euro, considering Germany's importance within the economic bloc. The data on changes in industrial production volumes in Germany will also carry weight. This indicator will showcase the utilization of production capacity and existing manufacturing trends. A joint analysis of these two indicators will provide a more comprehensive view of manufacturing activities.
As for the intraday strategy, I will focus more on implementing Scenarios No. 1 and No. 2.
Buying Scenarios
Scenario No. 1: Today, I can buy euros when the price reaches around 1.1571 (green line on the chart), targeting a rise to 1.1618. At point 1.1618, I plan to exit the market and also sell euros in the opposite direction, expecting a movement of 30-35 pips from the entry point. Growth for the euro today can only be anticipated after strong German data. Important! Before buying, ensure the MACD indicator is above the zero mark and just starting to rise from it.
Scenario No. 2: I also plan to buy euros today if the price tests 1.1545 twice in a row while the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. An increase towards the opposite levels of 1.1571 and 1.1618 can be expected.
Selling Scenarios
Scenario No. 1: I plan to sell euros once the price reaches 1.1545 (red line on the chart). The target will be the level of 1.1488, where I plan to exit the market and immediately buy in the opposite direction (expecting a movement of 20-25 pips in the opposite direction from the level). Pressure on the pair will remain today, in any case. Important! Before selling, ensure the MACD indicator is below the zero mark and just starting to decline from it.
Scenario No. 2: I also plan to sell euros today if the price tests 1.1571 twice in a row, with the MACD indicator in the overbought area. This will limit the upward potential of the pair and lead to a market reversal downward. A decline towards the opposite levels of 1.1545 and 1.1488 can be expected.
What's on the Chart:
- The thin green line represents the entry price at which you can buy the trading instrument;
- The thick green line is the assumed price where you can set Take Profit or manually take profit, as further growth above this level is unlikely;
- The thin red line indicates the entry price at which you can sell the trading instrument;
- The thick red line is the assumed price where you can set Take Profit or manually take profit, as further decline below this level is unlikely;
- The MACD indicator. When entering the market, it's important to refer to the overbought and oversold zones.
Important: Beginner traders in the forex market need to make entry decisions very carefully. It is best to stay out of the market before the release of important fundamental reports to avoid sharp fluctuations in prices. If you choose to trade during the release of news, always set Stop Loss orders to minimize losses. Without placing Stop Loss orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember, successful trading requires a clear trading plan, like the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.
