Analysis of transactions and tips for trading EUR/USD
The test of 1.1044 happened when the MACD line was far from zero, so the downward potential was limited. However, there was also no sharp upward movement, so a test of 1.1033 occurred in the afternoon, right after the release of the US GDP report. That gave around 30 pips price movement in the market.
Although consumer confidence data from the Euro area matched the forecasts, EUR/USD saw a decline as risk appetite fell amid disappointing Q1 GDP data from the US.
Upcoming reports today could affect euro, as good numbers are likely to strengthen buying pressure. Aside from the GDP reports for Germany and the eurozone, unemployment levels and inflation figures will influence market direction. There will also be PCE index from the US, as well as data on income and expenses, which could return demand for dollar. Chicago PMI data and consumer sentiment from the University of Michigan will be of much lesser importance.
For long positions:
Buy euro when the level of 1.1035 (green line on the chart) is reached and then take profit at the price of 1.1086. Growth will be seen if the is very good GDP data from the eurozone. 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 after two consecutive price tests of 1.1006, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1035 and 1.1086
For short positions:
Sell euro when the level of 1.1044 (red line on the chart) is reached and then take profit at the price of 1.1008. Pressure may return if the upcoming US GDP data exceeds expectations. 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 after two consecutive price tests of 1.1075, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1044 and 1.1008.
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
The test of 1.1044 happened when the MACD line was far from zero, so the downward potential was limited. However, there was also no sharp upward movement, so a test of 1.1033 occurred in the afternoon, right after the release of the US GDP report. That gave around 30 pips price movement in the market.
Although consumer confidence data from the Euro area matched the forecasts, EUR/USD saw a decline as risk appetite fell amid disappointing Q1 GDP data from the US.
Upcoming reports today could affect euro, as good numbers are likely to strengthen buying pressure. Aside from the GDP reports for Germany and the eurozone, unemployment levels and inflation figures will influence market direction. There will also be PCE index from the US, as well as data on income and expenses, which could return demand for dollar. Chicago PMI data and consumer sentiment from the University of Michigan will be of much lesser importance.
For long positions:
Buy euro when the level of 1.1035 (green line on the chart) is reached and then take profit at the price of 1.1086. Growth will be seen if the is very good GDP data from the eurozone. 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 after two consecutive price tests of 1.1006, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1035 and 1.1086
For short positions:
Sell euro when the level of 1.1044 (red line on the chart) is reached and then take profit at the price of 1.1008. Pressure may return if the upcoming US GDP data exceeds expectations. 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 after two consecutive price tests of 1.1075, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1044 and 1.1008.
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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