Analysis of Trades and Trading Tips for the Euro
The price test at 1.0815 occurred when the MACD indicator had moved significantly above the zero mark, which limited the pair's upside potential. For this reason, I did not buy the euro.
Yesterday, Trump announced a 10% tariff on all goods imported from countries that are key trading partners of the United States. For the EU, tariffs were set at 20%, for Japan at 24%, and the total on Chinese imports reached 54%. This initiative may become modern U.S. trade history's most radical protectionist step. Trump justified his stance as a way to protect American manufacturers and jobs from unfair foreign competition. The global community reacted quickly, with many countries expressing serious concern over the potential consequences of such a decision for the world economy. EU representatives stated they are ready to respond.
The euro may maintain its position today during the first half of the trading day, but this depends on the release of favorable PMI data in the services sector and the composite PMI for the eurozone. Otherwise, if the actual data disappoints, the euro may come under pressure. Market participants will also closely watch the eurozone producer price index. The European Central Bank's monetary policy meeting report is unlikely to influence the market significantly, as decisions are now less relevant under current conditions.
For intraday strategy, I will focus primarily on Scenarios #1 and #2.
Buy Signal
Scenario #1: I plan to buy the euro today if the price reaches around 1.0928 (green line on the chart), targeting a rise to 1.1019. At 1.1019, I plan to exit the market and open short positions in the opposite direction, expecting a pullback of 30–35 pips from the entry point. Expecting growth in the euro is reasonable within the ongoing bullish trend that started yesterday. Important! Before buying, ensure the MACD indicator is above the zero line and beginning to rise.
Scenario #2: I also plan to buy the euro today in the event of two consecutive tests of the 1.0889 level while the MACD indicator is in oversold territory. This will limit the pair's downside potential and lead to a market reversal to the upside. A rise to the opposite levels, 1.0928 and 1.1019, can be expected.
Sell Signal
Scenario #1: I plan to sell the euro after the price reaches the 1.0889 level (red line on the chart). The target will be 1.0815, where I plan to exit short positions and immediately buy in the opposite direction (expecting a 20–25 pip retracement). Downward pressure on the pair is unlikely to return today. Important! Before selling, make sure the MACD indicator is below the zero mark and beginning to decline.
Scenario #2: I also plan to sell the euro today in the event of two consecutive tests of the 1.0928 level while the MACD indicator is in overbought territory. This will limit the pair's upside potential and lead to a market reversal to the downside. A decline to the opposite levels, 1.0889 and 1.0815, can be expected.
What's on the Chart:
- The thin green line represents the entry price where the trading instrument can be bought.
- The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
- The thin red line represents the entry price where the trading instrument can be sold.
- The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
- The MACD indicator should be used to assess overbought and oversold zones when entering the market.
Important Notes:
- Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
- Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.
