18.05.202312:05 Forex Analysis & Reviews: Analysis and trading tips for EUR/USD on May 18 (US session)

The economic calendar being empty last Wednesday fueled the decline in EUR/USD. However, the test of 1.0825 coincided with the time that the MACD line was far from zero, so the downside potential was limited. Sometime later, there was another test, but it also resulted in losses.

Ahead are important reports from the US, such as the number of initial jobless claims, the Philadelphia Fed manufacturing index, and the volume of existing home sales. These will be enough to keep pressure on euro, continuing the pair's decline. Hawkish comments from FOMC member Lorie Logan could also result in further growth in dollar. However, euro will recover if none of these things happen.

For long positions:

Buy euro when the price hits 1.0830 (green line on the chart) and then take-profit when the quote reaches the level of 1.0861. Growth will continue if there is weak data in the real estate market. However, before buying, traders should make sure that the MACD line is above zero and is starting to rise from it.

Euro can also be bought after the level of 1.0807 is tested twice, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0830 and 1.0861.

For short positions:

Sell euro when the price reaches 1.0807 (red line on the chart) and take-profit at the level of 1.0777. Pressure will increase with good data on the US labor market. However, before selling, traders should make sure that the MACD line is below zero and is starting to drop down from it.

Euro can also be sold after the level of 1.0830 is tested twice, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0807 and 1.0777.

What's on the chart:

Thin green line - entry price at which you can buy EUR/USD

Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.

Thin red line - entry price at which you can sell EUR/USD

Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.

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

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 decision based on the current market situation is an inherently losing strategy for an intraday trader.