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Analysis of trades and trading tips on EUR
The test of 1.0687 occurred at a time when the MACD indicator had already moved away significantly from the zero level. It considerably limited the downward movement of the pair. Therefore, I did not open short positions on the euro, waiting for the implementation of scenario No. 2 on purchases. The necessary signal appeared rather quickly. However, long positions turned out to be unprofitable despite another test of 1.0687 and presumably favorable conditions for purchases. The pair kept declining. There were no other entry points during the day.
As widely expected, Germany's GDP report was in line with economists' forecasts. However, it did not boost the euro in the morning as well as the statements of ECB policymakers. Although they spoke in favor of key rate hikes, their comments were rather cautious. The FOMC meeting minutes for May did not contain anything new. Apparently, rumors about more aggressive monetary policy tightening this summer were just rumors. Today, the economic calendar for the eurozone is completely empty. Therefore, in the first half of the day, pressure on the euro may escalate. It may help determine entry points for long positions according to scenario No. 2. In the afternoon, the US will unveil the initial jobless claims report as well as the second estimate of GDP for the first quarter of this year. The figure is expected to be revised upwardly, which may facilitate the growth of the US dollar. Data on pending home sales in the US is unlikely to cause a surge in volatility. However, positivefigures may strengthen the main trend of the euro/dollar pair.
Buy signal
Scenario No.1: it is recommended to open long positions today if the price reaches 1.0695 (the green line on the chart) with an upward target of 1.0744. It is better to close long positions at 1.0744 and open short ones, keeping in mind a downward correction of 30-35 pips from the given level. The euro is unlikely to climb today in the first half of the day as bears are keeping control over the market. They could try to push the pair as low as possible even before the publication of the US GDP report. Important! Before opening long positions, make sure that the MACD indicator is above the zero level and it has just started to rise from it.
Scenario No.2: it is also possible to buy the euro today if the price approaches 1.0659. At this moment, the MACD indicator should be in the oversold area. It may limit the downward movement of the pair. It may also trigger an upward reversal. The pair is expected to jump to the opposite levels of 1.0695 and 1.0744.
Sell signal
Scenario No.1: it is recommended to open short positions if the price hits 1.0659 (the red line on the chart). The target will be the 1.0620 level. I would advise closing short positions at this level and opening long ones, keeping in mind an upward correction of 20-25 pips from the given level. The pressure on the euro is likely to persist due to the expected downward correction. Important! Before opening short positions, make sure that the MACD indicator is below the zero level and it has juststarted to decline from it.
Scenario No.2: it is also possible to sell the euro today if the price drops to 1.0695. At this moment, the MACD indicator should be in the overbought area. It may limit the upward potential of the pair. It could also trigger a downward reversal. The pair is projected to take a nosedive to the opposite level of 1.0659 and 1.0620.
What's on the chart:
The thin green line is the entry price to buy the trading instrument.
The thick green line is the estimated price where you can place a Take Profit or lock in profit manually as the price is unlikely torise above this level.
The thin red line is the entry price to sell the trading instrument.
The thick red line is the estimated price where you can place a Take Profit or lock in profit manually as the price is unlikely todecline below this level.
The MACD indicator is important for checking the overbought and oversold zones.
Important: beginners on Forex need to be very careful when making their entry decisions. It is better to stay out of the market ahead of important news releases in order to avoid sharp price fluctuations. If you decide to trade at the moment of publication, then always place stop-loss orders to minimize losses. Without a Stop Loss, you can easily lose your entire deposit, especially if you do not follow money management and trade in largevolumes.
For successful trading, you need to have a clear trading plan, like the one presented above. Spontaneous decision-making based on the current market situation is a losing strategy for an intraday trader.
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