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Analysis of previous deals:
30M chart of the EUR/USD pair
The EUR/USD pair was trading very weakly on Monday. Volatility of the day was only 42 points. If in the first half of the day the pair still somehow moved, then it became tightly stuck in one place in the afternoon. Thus, novice traders did not see active movements again. Basically, on the 30-minute timeframe, the nature of the pair's movement is perfectly visible and understandable at this time. For at least six consecutive days, all trades have been near the level of 1.1704, with which the pair has serious problems. Today the quotes seem to have gone below this level, but this withdrawal is clearly not going to be a confident breakthrough. And the price ends the day and does so "at" the level of 1.1704. Moreover, there is no trend right now. The fact that quotes are trading along the level of 1.1704 suggests that our movement is sideways, or flat, in other words. Also, during the first day of the week, there was not a single important macroeconomic report, and European Central Bank President Christine Lagarde's speech did not give the markets any new information.
5M chart of the EUR/USD pair
The technical picture on the 5-minute timeframe was very eloquent. As we said above, there was still a movement in the first half of the day, and then it became a total flat in the afternoon. Thus, it was still possible to trade in the first half of the day. Let's analyze all the trading signals and see which of them should be filtered and which should be worked out. The first buy signal in the form of a rebound from the level of 1.1704 immediately turned out to be false. The price was unable to continue its upward movement and settled below the level of 1.1704. Therefore, the first long position turned out to be unprofitable (-11 points). However, the next signal turned out to be better, as the price managed to go down to the nearest level of 1.1685 and, given the current volatility (low), this movement could well be considered and rejected by a short position. The profit, however, was only 10 points. Since there was a very accurate rebound from the level of 1.1685, this should be regarded as a signal to buy and reopen long positions. Since a rebound followed from the level of 1.1704, a long position should have been closed near this level in a profit of about 10 points and immediately open short positions. However, in the future the price failed to settle above the level of 1.1704 or to reach the level of 1.1685 again. Therefore, in the end, the last deal could have been closed with zero profit, since the flat was obvious in the US trading session.
How to trade on Tuesday:
The EUR/USD pair tried to form an upward trend on the 30-minute timeframe, but in fact it has been moving sideways for more than a week. Therefore, at this time, we do not recommend considering signals from the MACD indicator. First, the pair needs to complete the flat and form a trend line or channel. The key levels on the 5-minute timeframe for September 28 are 1.1666, 1.1685, 1.1704, 1.1735, 1.1750. Take Profit, as before, is set at a distance of 30-40 points. Stop Loss - to breakeven when the price passes in the right direction by 15 points. At the 5M TF, the target can be the nearest level if it is not too close or too far away. If it is located, then you should act according to the situation or work according to Take Profit. Among important events on Tuesday, we draw your attention to the speeches of ECB President Christine Lagarde and Federal Reserve Chairman Jerome Powell. It may well be that they will not provide any important information (like Lagarde today) and no market reaction will follow. But it may also be the other way around. Therefore, increased caution during their speeches.
We also recommend that you familiarize yourself with the GBP/USD review.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
The MACD indicator (14, 22, 3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.
