empty
 
 
You are about to leave
www.instaforex.eu >
a website operated by
INSTANT TRADING EU LTD
Open Account

20.10.202108:28 Forex Analysis & Reviews: Analysis and trading recommendations for EUR/USD on October 20

This information is provided to retail and professional clients as part of marketing communication. It does not contain and should not be construed as containing investment advice or investment recommendation or an offer or solicitation to engage in any transaction or strategy in financial instruments. Past performance is not a guarantee or prediction of future performance. Instant Trading EU Ltd. makes no representation and assumes no liability as to the accuracy or completeness of the information provided, or any loss arising from any investment based on analysis, forecast or other information provided by an employee of the Company or otherwise. Full disclaimer is available here.

Analysis of transactions in the EUR / USD pair

There was a signal to buy in EUR / USD on Tuesday, but it had to be ignored because the MACD line was far away from zero. Shortly after that a signal to sell appeared, and this time it provoked a large drop in the pair because traders took short positions. Then, another sell signal emerged, but it had to be ignored because the MACD line was far from zero. Afterwards, a buy signal appeared and it coincided with the MACD line being at the oversold area.

Exchange Rates 20.10.2021 analysis

Euro rallied yesterday because of the statements from ECB members Frank Elderson and Fabio Panetta. But the situation turned around in the afternoon as Fed members Mary Daly and Michelle Bowman addressed US inflation, which attracted investor interest on dollar.

Today, a lot of macro statistics are scheduled to come out, and these are EU data on CPI and ECB balance of payments, which, if exceeded expectations, could provoke another rally in EUR / USD. Another speech from ECB member Frank Elderson will also commence, followed by statements from Fed members Charles Evans, Raphael Bostic and Randal Quarles.

For long positions:

Open a long position when euro reaches 1.1656 (green line on the chart) and take profit at 1.1696. Price will increase if EU inflation data comes out strong.

Before buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.1635, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.1656 and 1.1696.

For short positions:

Open a short position when euro reaches 1.1635 (red line on the chart) and take profit at 1.1594. Pressure may return if there are weak EU statistics and if the Fed makes statements that are in favor of dollar.

Before selling, make sure that the MACD line is below zero, or is starting to move down from it. Euro could also be sold at 1.1656, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.1635 and 1.1594.

Exchange Rates 20.10.2021 analysis

What's on the chart:

The thin green line is the key level at which you can place long positions in the EUR/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the EUR/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

Jakub Novak
Analytical expert of InstaForex
© 2007-2024

Open trading account

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.




You are now leaving www.instaforex.eu, a website operated by INSTANT TRADING EU LTD
Can't speak right now?
Ask your question in the chat.

Turn "Do Not Track" off