Trade Analysis and Trading Tips for the European Currency

The test of the 1.1607 price level occurred when the MACD indicator had just begun moving downward from the zero line, confirming a valid entry point for selling the euro. As a result, the pair declined by only 7 points.

Going forward, investors and analysts will focus on a series of important U.S. macroeconomic reports. The University of Michigan Consumer Sentiment Index is expected to be released, which is considered an important indicator of consumer confidence and, consequently, potential consumer spending. At the same time, inflation expectations data will also be published. These figures are of critical importance for understanding how market participants and consumers assess future price levels.

Additional attention will be directed toward remarks by FOMC member Christopher Waller. His comments on the state of the economy, as well as any signals regarding future Federal Reserve actions, may significantly affect market sentiment and the direction of financial assets. A hawkish tone and firm monetary policy stance could support further dollar growth toward the end of the week.

As for the intraday strategy, I will primarily rely on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1

Today, buying the euro may be considered after the price reaches the 1.1615 area (green line on the chart), with a target at 1.1645. At the 1.1645 level, I plan to exit long positions and open short positions in the opposite direction, targeting a 30–35 point move from the entry point. Euro growth today can only be expected after weak U.S. economic data.

Important! Before buying, make sure that the MACD indicator is above the zero line and has just begun to move higher from it.

Scenario No. 2

I also plan to buy the euro today if there are two consecutive tests of the 1.1595 level while the MACD indicator is in oversold territory. This would limit the pair's downward potential and trigger an upward market reversal. In this case, growth toward the opposite levels of 1.1615 and 1.1645 may be expected.

Sell Signal

Scenario No. 1

I plan to sell the euro after the price reaches the 1.1595 level (red line on the chart). The target will be 1.1565, where I intend to exit short positions and immediately open long positions in the opposite direction, targeting a 20–25 point rebound from the level. Pressure on the pair is likely to return today if strong U.S. data is released.

Important! Before selling, make sure that the MACD indicator is below the zero line and has just begun moving lower from it.

Scenario No. 2

I also plan to sell the euro today if there are two consecutive tests of the 1.1615 level while the MACD indicator is in overbought territory. This would limit the pair's upward potential and trigger a downward market reversal. In this scenario, a decline toward the opposite levels of 1.1595 and 1.1565 may be expected.

Chart Explanation

• Thin green line – entry price at which the trading instrument can be bought;
• Thick green line – estimated level where Take Profit orders may be placed or profits may be manually locked in, as further growth above this level is unlikely;
• Thin red line – entry price at which the trading instrument can be sold;
• Thick red line – estimated level where Take Profit orders may be placed or profits may be manually locked in, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to use overbought and oversold zones as guidance.

Important

Beginner Forex traders should make market entry decisions very carefully. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize potential losses. Without stop-loss protection, you may lose your entire deposit very quickly, especially if you trade large volumes without proper money management.

And remember, successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based solely on current market conditions are generally a losing strategy for intraday traders.