Trading plan for EUR/USD on August 16. Simple tips for beginners
August 16, 2023 4:22 am
Analyzing Tuesday’s trades:
EUR/USD on 30M chart
On Tuesday, EUR/USD was quite chaotic. There was a small upward-sloping line, but even on the 30-minute chart, it’s easy to see how often the pair changed direction. In addition to this, the price closed above the descending trendline, and several reports were published in the EU and US, which, although they were not marked as “important,” still had some impact on the pair’s movement. Volatility was 56 points, which is very low. As a result, it was a low-volatility day, with chaotic movements, a ton of signals, and mixed economic reports.
The ZEW Economic Sentiment Index for the EU and Germany turned out to be slightly better than expected. The US retail sales report was also better than expected. There was a slight market reaction, but it only added confusion to the intraday movements. We can’t even conclude that an upward correction has started – the trend line was too weak.
EUR/USD on 5M chart
Several trading signals were formed on the 5-minute chart. Traders could gain 15 pips on the first buy signal around the 1.0904 level. It should have been closed when the price closed below the 1.0936 level. Based on this sell signal, short positions should have been opened, and subsequently, the 1.0904 level was retested, where shorts should have been closed. A bounce from this level – new longs and another 15 pips of profit. Later on, the pair started to “dance” around the 1.0936 level, forming false signals. They could have resulted in losses, but not all of them needed to be executed. Any two false signals around the same level “blocked” the execution of all subsequent ones. Therefore, the day still ended in profit, albeit a small one.
Trading tips on Wednesday:
On the 30M chart, the pair is trading with a downward tendency, and may continue to fall, which, in our opinion, is still the most justified and logical course of events. We don’t see any macroeconomic background that would be capable of changing market sentiment this week. The key levels on the 5M chart are 1.0761, 1.0835, 1.0871, 1.0901-1.0904, 1.0936, 1.0971-1.0981, 1.1011, 1.1043, 1.1091, 1.1132-1.1145, 1.1184, 1.1241. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Wednesday, the EU will publish its Q2 GDP in the second estimate, as well as industrial production. This may be sufficient enough to stir some market reaction or none at all.
Basic trading rules:
1) The strength of the signal depends on the time period during which the signal was formed (a rebound or a break). The shorter this period, the stronger the signal.
2) If two or more trades were opened at some level following false signals, i.e. those signals that did not lead the price to Take Profit level or the nearest target levels, then any consequent signals near this level should be ignored.
3) During the flat trend, any currency pair may form a lot of false signals or do not produce any signals at all. In any case, the flat trend is not the best condition for trading.
4) Trades are opened in the time period between the beginning of the European session and until the middle of the American one when all deals should be closed manually.
5) We can pay attention to the MACD signals in the 30M time frame only if there is good volatility and a definite trend confirmed by a trend line or a trend channel.
6) If two key levels are too close to each other (about 5-15 pips), then this is a support or resistance area.
How to read charts:
Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.
Red lines are channels or trend lines that display the current trend and show which direction is better to trade.
MACD indicator (14,22,3) is a histogram and a signal line showing when it is better to enter the market when they cross. This indicator is better to be used in combination with trend channels or trend lines.
Important speeches and reports that are always reflected in the economic calendars can greatly influence the movement of a currency pair. Therefore, during such events, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.
Beginners should remember that every trade cannot be profitable. The development of a reliable strategy and money management are the key to success in trading over a long period of time.
The material has been provided by InstaForex Company – www.instaforex.com
Analyzing Tuesday’s trades:
EUR/USD on 30M chart
On Tuesday, EUR/USD was quite chaotic. There was a small upward-sloping line, but even on the 30-minute chart, it’s easy to see how often the pair changed direction. In addition to this, the price closed above the descending trendline, and several reports were published in the EU and US, which, although they were not marked as “important,” still had some impact on the pair’s movement. Volatility was 56 points, which is very low. As a result, it was a low-volatility day, with chaotic movements, a ton of signals, and mixed economic reports.
The ZEW Economic Sentiment Index for the EU and Germany turned out to be slightly better than expected. The US retail sales report was also better than expected. There was a slight market reaction, but it only added confusion to the intraday movements. We can’t even conclude that an upward correction has started – the trend line was too weak.
EUR/USD on 5M chart
Several trading signals were formed on the 5-minute chart. Traders could gain 15 pips on the first buy signal around the 1.0904 level. It should have been closed when the price closed below the 1.0936 level. Based on this sell signal, short positions should have been opened, and subsequently, the 1.0904 level was retested, where shorts should have been closed. A bounce from this level – new longs and another 15 pips of profit. Later on, the pair started to “dance” around the 1.0936 level, forming false signals. They could have resulted in losses, but not all of them needed to be executed. Any two false signals around the same level “blocked” the execution of all subsequent ones. Therefore, the day still ended in profit, albeit a small one.
Trading tips on Wednesday:
On the 30M chart, the pair is trading with a downward tendency, and may continue to fall, which, in our opinion, is still the most justified and logical course of events. We don’t see any macroeconomic background that would be capable of changing market sentiment this week. The key levels on the 5M chart are 1.0761, 1.0835, 1.0871, 1.0901-1.0904, 1.0936, 1.0971-1.0981, 1.1011, 1.1043, 1.1091, 1.1132-1.1145, 1.1184, 1.1241. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Wednesday, the EU will publish its Q2 GDP in the second estimate, as well as industrial production. This may be sufficient enough to stir some market reaction or none at all.
Basic trading rules:
1) The strength of the signal depends on the time period during which the signal was formed (a rebound or a break). The shorter this period, the stronger the signal.
2) If two or more trades were opened at some level following false signals, i.e. those signals that did not lead the price to Take Profit level or the nearest target levels, then any consequent signals near this level should be ignored.
3) During the flat trend, any currency pair may form a lot of false signals or do not produce any signals at all. In any case, the flat trend is not the best condition for trading.
4) Trades are opened in the time period between the beginning of the European session and until the middle of the American one when all deals should be closed manually.
5) We can pay attention to the MACD signals in the 30M time frame only if there is good volatility and a definite trend confirmed by a trend line or a trend channel.
6) If two key levels are too close to each other (about 5-15 pips), then this is a support or resistance area.
How to read charts:
Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.
Red lines are channels or trend lines that display the current trend and show which direction is better to trade.
MACD indicator (14,22,3) is a histogram and a signal line showing when it is better to enter the market when they cross. This indicator is better to be used in combination with trend channels or trend lines.
Important speeches and reports that are always reflected in the economic calendars can greatly influence the movement of a currency pair. Therefore, during such events, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.
Beginners should remember that every trade cannot be profitable. The development of a reliable strategy and money management are the key to success in trading over a long period of time.
The material has been provided by InstaForex Company – www.instaforex.com
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