Trade Analysis and Tips for Trading the European Currency

The test of the 1.1870 price level occurred at a moment when the MACD indicator had already moved significantly downward from the zero level, which limited the pair's downward potential. For this reason, I did not sell the euro.

Next, a series of U.S. economic reports is expected to be released. In particular, weekly ADP data on changes in U.S. private-sector employment, the Consumer Confidence Index, and house price change indicators for the twenty largest metropolitan areas will be published. For a noticeable strengthening of the U.S. dollar, these indicators must show exceptionally strong readings.

Market participants will pay special attention to the ADP report. A significant increase in jobs may boost optimism about the overall labor market situation and support the dollar. The Conference Board Consumer Confidence Index is also an important indicator of economic conditions. An increase in consumer confidence reflects households' willingness to spend, which could allow the dollar to strengthen slightly, although this is unlikely. The S&P/Case-Shiller Home Price Index, covering 20 major cities, shows trends in the housing market. Weak price growth, especially in large cities, indicates low demand and an unfavorable economic environment. Thus, the upcoming U.S. session will provide important information about the health of the U.S. economy.

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

Buy Signal

Scenario No. 1: Today, the euro can be bought if the price reaches the 1.1900 level (green line on the chart), with a target of growth toward the 1.1936 level. At 1.1936, I plan to exit the market and also sell the euro in the opposite direction, expecting a move of 30–35 points from the entry point. Strong euro growth should be expected only after weak economic data.Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2: I also plan to buy the euro today if there are two consecutive tests of the 1.1862 price level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal upward. Growth toward the opposite levels of 1.1900 and 1.1936 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after the price reaches the 1.1862 level (red line on the chart). The target will be the 1.1826 level, where I plan to exit the market and immediately buy in the opposite direction (expecting a move of 20–25 points in the opposite direction from the level). Pressure on the pair will return if strong economic data is released.Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario No. 2: I also plan to sell the euro today if there are two consecutive tests of the 1.1900 price level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.1862 and 1.1826 can be expected.

What's on the Chart:

• Thin green line – entry price at which the trading instrument can be bought;
• Thick green line – estimated price where Take Profit can be set or profits can be taken manually, 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 price where Take Profit can be set or profits can be taken manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to focus on overbought and oversold zones.

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important 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 set stop orders to minimize losses. Without stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember, successful trading requires a clear trading plan, like the one presented above. Spontaneous trading decisions based on the current market situation are an inherently losing strategy for an intraday trader.