Trading plan for EUR/USD on September 7. Simple tips for beginners
September 7, 2023 4:24 am
Analyzing Wednesday’s trades:
EUR/USD on 30M chart
On Wednesday, EUR/USD tried to continue the same movement but experienced a slight upward correction beforehand. Basically, the pair was trading lower for a couple of hours, when the ISM Services PMI was published in the United States. As we mentioned earlier this week, this is the main item on this week’s agenda, but it only prompted a 30-pip move in 5 minutes. The ISM index came out stronger than expected, causing the dollar to appreciate. The downtrend persists, as indicated by the descending trendline, and there were no major macroeconomic or fundamental events.
However, there were secondary events. Retail sales in the European Union fell more than expected, and Governing Council members Francois Villeroy de Galhau and Peter Kazimir both stated that the end of the monetary tightening program is near. This fact could exert even more downward pressure on the euro, but you should not consider long positions until we can confirm that it is above the trendline.
EUR/USD on 5M chart
The pair’s movements seemed flat on the 5-minute chart, especially during the first half of the day. Throughout the European session, the price stayed around the 1.0733 level, then moved slightly upward before sharply dropping. The first buy signal turned out to be false, but it was possible to get out of it without losses, since it was better to manually close all positions before the ISM report. There was no opportunity to execute a sell signal, as the price dropped within just 5 minutes. Therefore, the day either ended with a small loss or zero profit. In general, the movements weren’t great either.
Trading tips on Thursday:
The pair’s movements on the 30M chart have been quite erratic over the past few weeks. Since the pair surpassed the 1.0767-1.0781 area, and the descending trendline remains relevant, the downward movement persists. We support the downtrend in the medium term regardless of any macroeconomic or fundamental background. The key levels on the 5M chart are 1.0517-1.0533, 1.0607-1.0613, 1.0673, 1.0733, 1.0767-1.0781, 1.0835, 1.0871, 1.0901-1.0904, 1.0936, 1.0971-1.0981. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Thursday, market participants will monitor the eurozone GDP report for the second quarter in its final estimate, and the US jobless claims. Reports can only trigger a strong reaction if its figures significantly deviate from forecasts.
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 Wednesday’s trades:
EUR/USD on 30M chart
On Wednesday, EUR/USD tried to continue the same movement but experienced a slight upward correction beforehand. Basically, the pair was trading lower for a couple of hours, when the ISM Services PMI was published in the United States. As we mentioned earlier this week, this is the main item on this week’s agenda, but it only prompted a 30-pip move in 5 minutes. The ISM index came out stronger than expected, causing the dollar to appreciate. The downtrend persists, as indicated by the descending trendline, and there were no major macroeconomic or fundamental events.
However, there were secondary events. Retail sales in the European Union fell more than expected, and Governing Council members Francois Villeroy de Galhau and Peter Kazimir both stated that the end of the monetary tightening program is near. This fact could exert even more downward pressure on the euro, but you should not consider long positions until we can confirm that it is above the trendline.
EUR/USD on 5M chart
The pair’s movements seemed flat on the 5-minute chart, especially during the first half of the day. Throughout the European session, the price stayed around the 1.0733 level, then moved slightly upward before sharply dropping. The first buy signal turned out to be false, but it was possible to get out of it without losses, since it was better to manually close all positions before the ISM report. There was no opportunity to execute a sell signal, as the price dropped within just 5 minutes. Therefore, the day either ended with a small loss or zero profit. In general, the movements weren’t great either.
Trading tips on Thursday:
The pair’s movements on the 30M chart have been quite erratic over the past few weeks. Since the pair surpassed the 1.0767-1.0781 area, and the descending trendline remains relevant, the downward movement persists. We support the downtrend in the medium term regardless of any macroeconomic or fundamental background. The key levels on the 5M chart are 1.0517-1.0533, 1.0607-1.0613, 1.0673, 1.0733, 1.0767-1.0781, 1.0835, 1.0871, 1.0901-1.0904, 1.0936, 1.0971-1.0981. A stop loss can be set at a breakeven point as soon as the price moves 15 pips in the right direction. On Thursday, market participants will monitor the eurozone GDP report for the second quarter in its final estimate, and the US jobless claims. Reports can only trigger a strong reaction if its figures significantly deviate from forecasts.
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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