Analysis of transactions and tips for trading EUR/USD
Euro tested the level of 1.0979 when the MACD line was just beginning to move downward, which was a good reason to sell. This resulted in a price decrease of around 30 pips. No other market signal appeared for the rest of the day.
Inflation data in the Euro area came out mixed as on the one hand, the overall figure increased, while on the other hand, core prices dipped slightly. This kind of report is clearly not enough for the European Central Bank to decide to stop raising rates.
Today, a report on the unemployment rate in the eurozone is expected, but it will not be of any interest to traders. More interesting and important statistics lie ahead.
The US is scheduled to release an employment report from ADP, as well as business activity data in the service sector from ISM. Growth in these indicators will not give the Fed a chance to consider a softer policy in the future. Therefore, rates are likely to continue increasing, which will be in favor of dollar. That will also lead to a collapse in euro.
For long positions:
Buy euro when the level of 1.1039 (green line on the chart) is reached and then take profit at the price of 1.1086. Growth will be seen if there is very good unemployment data 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 1.1008, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1039 and 1.1086.
For short positions:
Sell euro when the level of 1.1008 (red line on the chart) is reached and then take profit at the price of 1.0959. Pressure will return only in the afternoon, after the Fed’s decision. 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 1.1039, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1008 and 1.0959.
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 the level of 1.0979 when the MACD line was just beginning to move downward, which was a good reason to sell. This resulted in a price decrease of around 30 pips. No other market signal appeared for the rest of the day.
Inflation data in the Euro area came out mixed as on the one hand, the overall figure increased, while on the other hand, core prices dipped slightly. This kind of report is clearly not enough for the European Central Bank to decide to stop raising rates.
Today, a report on the unemployment rate in the eurozone is expected, but it will not be of any interest to traders. More interesting and important statistics lie ahead.
The US is scheduled to release an employment report from ADP, as well as business activity data in the service sector from ISM. Growth in these indicators will not give the Fed a chance to consider a softer policy in the future. Therefore, rates are likely to continue increasing, which will be in favor of dollar. That will also lead to a collapse in euro.
For long positions:
Buy euro when the level of 1.1039 (green line on the chart) is reached and then take profit at the price of 1.1086. Growth will be seen if there is very good unemployment data 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 1.1008, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1039 and 1.1086.
For short positions:
Sell euro when the level of 1.1008 (red line on the chart) is reached and then take profit at the price of 1.0959. Pressure will return only in the afternoon, after the Fed’s decision. 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 1.1039, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1008 and 1.0959.
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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