Analysis of transactions and tips for trading EUR/USD
Euro tested 1.0956 when the MACD line was already far from zero, limiting the upside potential of the pair. Meanwhile, sales on the rebound from 1.0982 brought over 30 pips of profit.
Buyers ignored the poor statistics from Germany and the eurozone even though they indicated a decline in the business environment. Data on the US real estate market also set EUR/USD to the positions it reached yesterday.
Ahead are key inflation reports, namely the eurozone consumer price index and the core price index. These will be crucial to the further direction of the pair, in which growth will lead to euro purchases, as this will put more pressure on the ECB to continue raising rates. Speeches by ECB Executive Board members Philip Lane and Isabel Schnabel will also help to understand what policymakers are thinking. In the afternoon, the Fed Beige Book is due to be released, but it is unlikely to have serious effects on the market.
For long positions:
Buy euro when the level of 1.0971 (green line on the chart) is reached and then take profit at the price of 1.1007. Growth will be seen if inflation in the eurozone shows another increase. However, before buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0938, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0971 and 1.1007.
For short positions:
Sell euro when the level of 1.0938 (red line on the chart) is reached and then take profit at the price of 1.0906. Pressure may return if inflation drops more than expected. However, make sure that before selling, the MACD line is below zero or is starting to move down from it. Euro can also be sold at 1.0971, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0938 and 1.0906.
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.
The material has been provided by InstaForex Company – www.instaforex.com
Analysis of transactions and tips for trading EUR/USD
Euro tested 1.0956 when the MACD line was already far from zero, limiting the upside potential of the pair. Meanwhile, sales on the rebound from 1.0982 brought over 30 pips of profit.
Buyers ignored the poor statistics from Germany and the eurozone even though they indicated a decline in the business environment. Data on the US real estate market also set EUR/USD to the positions it reached yesterday.
Ahead are key inflation reports, namely the eurozone consumer price index and the core price index. These will be crucial to the further direction of the pair, in which growth will lead to euro purchases, as this will put more pressure on the ECB to continue raising rates. Speeches by ECB Executive Board members Philip Lane and Isabel Schnabel will also help to understand what policymakers are thinking. In the afternoon, the Fed Beige Book is due to be released, but it is unlikely to have serious effects on the market.
For long positions:
Buy euro when the level of 1.0971 (green line on the chart) is reached and then take profit at the price of 1.1007. Growth will be seen if inflation in the eurozone shows another increase. However, before buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0938, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0971 and 1.1007.
For short positions:
Sell euro when the level of 1.0938 (red line on the chart) is reached and then take profit at the price of 1.0906. Pressure may return if inflation drops more than expected. However, make sure that before selling, the MACD line is below zero or is starting to move down from it. Euro can also be sold at 1.0971, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0938 and 1.0906.
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.
The material has been provided by InstaForex Company – www.instaforex.com
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