Analysis and trading tips for EUR/USD on May 17
May 17, 2023 7:22 amVideo
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Analysis of transactions and tips for trading EUR/USD
The test of 1.0886 happened when the MACD line was quite far from zero, so the upward potential was limited. By mid-day, there was a downward movement and update of 1.0882, but the MACD line was still far from zero, so purchases resulted in losses.
Correction in euro did not continue as reports indicated weak data on business sentiment in both Germany and the eurozone. The second estimate for the 1st quarter GDP was also lower than expected, and data on US retail sales turned demand for dollar, leading to a further decline in EUR/USD.
Today’s reports on the eurozone consumer price index and core prices will be decisive. A further increase in inflation will push euro up. However, the speech of ECB board member Frank Elderson is unlikely to help buyers.
For long positions:
Buy euro when the level of 1.0871 (green line on the chart) is reached and then take profit at the price of 1.0905. Growth will be seen if there is a surge in inflation in 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 1.0848, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0871 and 1.0905.
For short positions:
Sell euro when the level of 1.0848 (red line on the chart) is reached and then take profit at the price of 1.0813. Pressure will return if there is no price growth in the eurozone. However, when selling, traders should make sure that 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 1.0871, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0848 and 1.0813.
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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