EUR/USD: Simple trading tips for beginner traders on May 31st (American session)
May 31, 2023 3:24 pm
The price test at 1.0680 occurred when MACD had already dropped significantly below the zero mark, limiting the downside potential of the pair. For this reason, I did not sell the euro. Trader positions changed in the second half of the day. Speeches by FOMC members Bowman and Harker are expected, which can significantly influence market direction. Any statements regarding interest rates and policymakers’ assessment of the situation in June of this year may only increase pressure on the euro, leading to a decline in the EUR/USD pair. Positive figures for the Chicago Purchasing Managers’ Index (PMI) will only strengthen the confidence of euro sellers in their actions. Therefore, I will stick to the implementation of scenario #1. However, today is the end of the month, and there may be an upward correction of the pair towards the end of the day.
Buy signal
Scenario #1: Today, you can buy the euro when the price reaches around 1.0696 (green line on the chart) with a target of 1.0731. At the level of 1.0731, I recommend exiting the market and selling the euro in the opposite direction, expecting a 30-35 points movement from the entry point. The euro’s rise is possible only with very weak statistics from the United States. Important! Before buying, ensure the MACD indicator is above the zero mark and starting to rise.
Scenario #2: Today, you can also buy the euro if there are two consecutive tests of the price at 1.0675 when the MACD indicator is in oversold territory. This will limit the downside potential of the pair and lead to a reverse market movement upwards. It is possible to expect a rise towards the opposite levels of 1.0696 and 1.0731.
Sell signal
Scenario #1: Selling the euro is possible after reaching the level of 1.0675 (red line on the chart). The target will be the level of 1.0644, where I recommend exiting the market and buying the euro immediately in the opposite direction (expecting a movement of 20-25 pips in the opposite direction from the level). Pressure on the pair will persist in case of aggressive statements by policymakers aimed at combating inflation. Important! Before selling, ensure that the MACD indicator is below the zero mark and starting to decline from it.
Scenario #2: Today, you can also sell the euro if there are two consecutive tests of the price at 1.0696 when the MACD indicator is in overbought territory. This will limit the upside potential of the pair and lead to a reverse market movement downwards. It is possible to expect a decline towards the opposite levels of 1.0675 and 1.0644.
What’s on the chart:
Thin green line – entry price at which the trading instrument can be bought.
Thick green line – the presumed price at which to set Take Profit or manually lock in profits, as further growth above this level is unlikely.
Thin red line – entry price at which the trading instrument can be sold.
Thick red line – the presumed price to set Take Profit or manually lock in profits, as further decline below this level is unlikely.
MACD indicator. When entering the market, it is important to consider overbought and oversold zones.
Important. Beginner traders in the Forex market must be very cautious when deciding to enter the market. It is best to stay out of the market before important fundamental reports to avoid being caught in sharp exchange rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You can quickly lose your deposit without placing stop orders, especially if you don’t use money management and trade with large volumes.
And remember, for successful trading, it is necessary to have a clear trading plan like the one presented above. Spontaneously making trading decisions 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
The price test at 1.0680 occurred when MACD had already dropped significantly below the zero mark, limiting the downside potential of the pair. For this reason, I did not sell the euro. Trader positions changed in the second half of the day. Speeches by FOMC members Bowman and Harker are expected, which can significantly influence market direction. Any statements regarding interest rates and policymakers’ assessment of the situation in June of this year may only increase pressure on the euro, leading to a decline in the EUR/USD pair. Positive figures for the Chicago Purchasing Managers’ Index (PMI) will only strengthen the confidence of euro sellers in their actions. Therefore, I will stick to the implementation of scenario #1. However, today is the end of the month, and there may be an upward correction of the pair towards the end of the day.
Buy signal
Scenario #1: Today, you can buy the euro when the price reaches around 1.0696 (green line on the chart) with a target of 1.0731. At the level of 1.0731, I recommend exiting the market and selling the euro in the opposite direction, expecting a 30-35 points movement from the entry point. The euro’s rise is possible only with very weak statistics from the United States. Important! Before buying, ensure the MACD indicator is above the zero mark and starting to rise.
Scenario #2: Today, you can also buy the euro if there are two consecutive tests of the price at 1.0675 when the MACD indicator is in oversold territory. This will limit the downside potential of the pair and lead to a reverse market movement upwards. It is possible to expect a rise towards the opposite levels of 1.0696 and 1.0731.
Sell signal
Scenario #1: Selling the euro is possible after reaching the level of 1.0675 (red line on the chart). The target will be the level of 1.0644, where I recommend exiting the market and buying the euro immediately in the opposite direction (expecting a movement of 20-25 pips in the opposite direction from the level). Pressure on the pair will persist in case of aggressive statements by policymakers aimed at combating inflation. Important! Before selling, ensure that the MACD indicator is below the zero mark and starting to decline from it.
Scenario #2: Today, you can also sell the euro if there are two consecutive tests of the price at 1.0696 when the MACD indicator is in overbought territory. This will limit the upside potential of the pair and lead to a reverse market movement downwards. It is possible to expect a decline towards the opposite levels of 1.0675 and 1.0644.
What’s on the chart:
Thin green line – entry price at which the trading instrument can be bought.
Thick green line – the presumed price at which to set Take Profit or manually lock in profits, as further growth above this level is unlikely.
Thin red line – entry price at which the trading instrument can be sold.
Thick red line – the presumed price to set Take Profit or manually lock in profits, as further decline below this level is unlikely.
MACD indicator. When entering the market, it is important to consider overbought and oversold zones.
Important. Beginner traders in the Forex market must be very cautious when deciding to enter the market. It is best to stay out of the market before important fundamental reports to avoid being caught in sharp exchange rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You can quickly lose your deposit without placing stop orders, especially if you don’t use money management and trade with large volumes.
And remember, for successful trading, it is necessary to have a clear trading plan like the one presented above. Spontaneously making trading decisions 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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