14.07.202110:43 Forex Analysis & Reviews: Analysis and trading recommendations for EUR/USD and GBP/USD on July 14

Analysis of transactions in the EUR / USD pair

Several signals appeared in the market on Tuesday, but only one was successful. In fact, the first one, which was to sell, had to be ignored because it came when the MACD line was way below zero. Fortunately by afternoon, a signal to buy was formed, and it coincided with the MACD line being in the oversold area. With that, EUR / USD climbed by as much as 25 pips.

Trading recommendations for July 14

Latest inflation data from Germany, France and US led to a decline in EUR / USD. Most likely, this would continue if the upcoming industrial report from the Euro area turns out worse than expected. But in the afternoon, there is a chance for rebound if Fed Chairman Jerome Powell addresses the rapid rise of US inflation.

For long positions:

Open a long position when euro reaches 1.1800 (green line on the chart), and then take profit around the level of 1.1848. Demand will increase if the Euro area releases strong economic reports. But 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 1.1768 and 1.1720, but the MACD indicator should be in the oversold area, as such would trigger a market reversal to 1.1800.

For short positions:

Open a short position when euro reaches 1.1768 (red line on the chart), and then take profit at the level of 1.1720. A decline will occur if the Euro area releases weak economic reports, and if Fed Chairman Jerome Powell addresses the rapid rise of US inflation. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

It is also possible to sell at 1.1800 and 1.1848, but the MACD indicator should be in the overbought area, as such would trigger a market reversal to 1.1768.

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.

Analysis of transactions in the GBP / USD pair

A signal to sell appeared in the market on Tuesday, but it had to be ignored because the MACD line was at the oversold area. Nevertheless, GBP / USD still decreased amid the data on US inflation. But the situation could turn around after the release of other economic indicators.

Trading recommendations for July 14

The Bank of England report released on Tuesday put pressure on GBP / USD, but the huge sell-off came during the US session, when the data on inflation exceeded analysts' forecast.

Today, investors should pay attention to the report on UK inflation, as a similar divergence from the forecasts could lead to a surge in volatility. If inflation turns out higher than expected, demand for pound will increase.

GBP / USD could also climb further amid statements from Fed Chairman Jerome Powell.

For long positions:

Open a long position when pound reaches 1.3835 (green line on the chart), and then take profit at the level of 1.3886 (thicker green line on the chart). Demand will increase if UK releases a strong CPI report. But 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 1.3809 and 1.3755, but the MACD indicator should be in the oversold area, as such would trigger a market reversal to 1.3835.

For short positions:

Open a short position when pound reaches 1.3809 (red line on the chart), and then take profit at the level of 1.3755. A decline may occur if UK releases weak data on CPI. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

It is also possible to sell at 1.3835 and 1.3886, but the MACD indicator should be in the overbought area, as such would trigger a market reversal to 1.3809.

What's on the chart:

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