Trading plan for EUR/USD on November 8. Simple tips for beginners
November 8, 2023 3:22 am
Analyzing Tuesday’s trades:
EUR/USD on 30M chart
On Tuesday, EUR/USD continued its downward movement, which began on Monday, and by the end of the day, it was near the level of 1.0673. The pair couldn’t surpass this mark, and overall, volatility was 56 pips. Again, this is a very small value that doesn’t offer good signals or significant profit potential. Thus, the pair continues to correct after Friday’s growth, and we believe that it’s a good time to resume the downtrend in the medium-term perspective. To do that, it needs to break through the level of 1.0673.
The euro even had formal reasons for a decline. Germany’s industrial production fell by 1.4% in September, a figure that surpassed the projected -0.1%. This report isn’t crucial, but it could trigger a market reaction of 20 pips, which is quite significant considering the fact that volatility was just 56 pips. However, the macroeconomic background was almost absent on Tuesday.
EUR/USD on 5M chart
On the 5-minute chart, three trading signals were generated. Each time, the pair bounced off the 1.0673 level and failed to move in the intended direction by 15 pips. As a result, beginners could have opened a long position that remained open until now since there were no sell signals. Therefore, it should have been manually closed at any convenient moment, and there should have been no loss in this trade.
Trading tips on Wednesday:
On the 30-minute chart, the corrective phase remains intact, but we don’t know how long this will last. Take note that the pair remained stagnant for several weeks until the employment and unemployment data were released in the United States. The start of the new week has progressed in the dollar’s favor, but the greenback’s growth has been relatively weak. We expect a more significant decline in the pair. The key levels on the 5M chart are 1.0451, 1.0483, 1.0526, 1.0568, 1.0611-1.0618, 1.0673, 1.0733, 1.0767-1.0781, 1.0835, and 1.0871. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Wednesday, Germany will release the final estimate of its inflation report for October (secondary indicator). In the European Union, retail sales data will be released (secondary indicator), and in the U.S., Federal Reserve Chair Jerome Powell will speak. We can consider Powell’s speech as the main event of the day, but he probably won’t reveal anything new to the markets compared to last week when the Fed meeting took place. Nevertheless, this is still an important event, and no one knows what he will say right now.
Basic trading rules:
1) Signal strength is determined by the time taken for its formation (either a bounce or level breach). A shorter formation time indicates a stronger signal.
2) If two or more trades around a certain level are initiated based on false signals, subsequent signals from that level should be disregarded.
3) In a flat market, any currency pair can produce multiple false signals or none at all. In any case, the flat trend is not the best condition for trading.
4) Trading activities are confined between the onset of the European session and mid-way through the U.S. session, post which all open trades should be manually closed.
5) On the 30-minute timeframe, trades based on MACD signals are only advisable amidst substantial volatility and an established trend, confirmed either by a trend line or trend channel.
6) If two levels lie closely together (ranging from 5 to 15 pips apart), they should be considered as a support or resistance zone.
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 represent channels or trend lines, depicting the current market trend and indicating the preferable trading direction.
The MACD(14,22,3) indicator, encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a signal source.
Significant speeches and reports (always noted in the news calendar) can profoundly influence the price dynamics. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to prevent abrupt price reversals against the prevailing trend.
Beginning traders should always remember that not every trade will yield profit. Establishing a clear strategy coupled with sound money management is the cornerstone of sustained trading success.
The material has been provided by InstaForex Company – www.instaforex.com
Analyzing Tuesday’s trades:
EUR/USD on 30M chart
On Tuesday, EUR/USD continued its downward movement, which began on Monday, and by the end of the day, it was near the level of 1.0673. The pair couldn’t surpass this mark, and overall, volatility was 56 pips. Again, this is a very small value that doesn’t offer good signals or significant profit potential. Thus, the pair continues to correct after Friday’s growth, and we believe that it’s a good time to resume the downtrend in the medium-term perspective. To do that, it needs to break through the level of 1.0673.
The euro even had formal reasons for a decline. Germany’s industrial production fell by 1.4% in September, a figure that surpassed the projected -0.1%. This report isn’t crucial, but it could trigger a market reaction of 20 pips, which is quite significant considering the fact that volatility was just 56 pips. However, the macroeconomic background was almost absent on Tuesday.
EUR/USD on 5M chart
On the 5-minute chart, three trading signals were generated. Each time, the pair bounced off the 1.0673 level and failed to move in the intended direction by 15 pips. As a result, beginners could have opened a long position that remained open until now since there were no sell signals. Therefore, it should have been manually closed at any convenient moment, and there should have been no loss in this trade.
Trading tips on Wednesday:
On the 30-minute chart, the corrective phase remains intact, but we don’t know how long this will last. Take note that the pair remained stagnant for several weeks until the employment and unemployment data were released in the United States. The start of the new week has progressed in the dollar’s favor, but the greenback’s growth has been relatively weak. We expect a more significant decline in the pair. The key levels on the 5M chart are 1.0451, 1.0483, 1.0526, 1.0568, 1.0611-1.0618, 1.0673, 1.0733, 1.0767-1.0781, 1.0835, and 1.0871. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Wednesday, Germany will release the final estimate of its inflation report for October (secondary indicator). In the European Union, retail sales data will be released (secondary indicator), and in the U.S., Federal Reserve Chair Jerome Powell will speak. We can consider Powell’s speech as the main event of the day, but he probably won’t reveal anything new to the markets compared to last week when the Fed meeting took place. Nevertheless, this is still an important event, and no one knows what he will say right now.
Basic trading rules:
1) Signal strength is determined by the time taken for its formation (either a bounce or level breach). A shorter formation time indicates a stronger signal.
2) If two or more trades around a certain level are initiated based on false signals, subsequent signals from that level should be disregarded.
3) In a flat market, any currency pair can produce multiple false signals or none at all. In any case, the flat trend is not the best condition for trading.
4) Trading activities are confined between the onset of the European session and mid-way through the U.S. session, post which all open trades should be manually closed.
5) On the 30-minute timeframe, trades based on MACD signals are only advisable amidst substantial volatility and an established trend, confirmed either by a trend line or trend channel.
6) If two levels lie closely together (ranging from 5 to 15 pips apart), they should be considered as a support or resistance zone.
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 represent channels or trend lines, depicting the current market trend and indicating the preferable trading direction.
The MACD(14,22,3) indicator, encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a signal source.
Significant speeches and reports (always noted in the news calendar) can profoundly influence the price dynamics. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to prevent abrupt price reversals against the prevailing trend.
Beginning traders should always remember that not every trade will yield profit. Establishing a clear strategy coupled with sound money management is the cornerstone of sustained trading success.
The material has been provided by InstaForex Company – www.instaforex.com
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