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Analysis of transactions in the EUR / USD pair
It was quite difficult to interpret the market signal on Monday because even though the MACD line was not in the overbought area, it was way below zero. Short positions could bring pretty good profit, but a safer move is to open a long position after a rebound from 1.1773.
A similar scenario occurred around 1.1815, but this time it is better to sell because the MACD line is at the overbought area.
Trading recommendations for July 20
Data released on Monday did not affect the markets very much, but the statements of US President Joe Biden on inflation, as well as his attitude towards the decisions of the Federal Reserve, caused a spike in market volatility.
Today, a report on German producer prices will be published, followed by the data on the current account balance of the ECB. But both are unlikely to cause significant fluctuations in the market, so traders should receive them quite calmly. There will also be reports on the US construction sector, but like the previous reports, they are unlikely to cause sharp movements in the market.
For long positions:
Open a long position when euro reaches 1.1805 (green line on the chart), and then take profit at the level of 1.1849 (thicker green line on the chart). Demand will increase if the European Central Bank announces that it would reconsider winding down measures to support the economy. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.
It is also possible to buy at 1.1783 and 1.1745, but the MACD indicator line be in the oversold area in order to bring about a market reversal to 1.1805.
For short positions:
Open a short position when euro reaches 1.1783 (red line on the chart), and then take profit at the level of 1.1745. A decline will occur if Germany publishes a weak PPI report. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.
It is also possible to sell at 1.1805 and 1.1849, but the MACD line should be in the overbought area in order to provoke a market reversal to 1.1783.
What's on the chart:
The thin green line is the key level at which you can place long positions in the EUR / USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the EUR / USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.
Analysis of transactions in the GBP / USD pair
A signal to sell was formed in the market on Monday, which led to a huge 40-pip drop in GBP / USD. However, pound was not able to reach the target level, which is 1.3694. Then, in the afternoon, there was a signal to buy, which coincided with the MACD line being at the oversold area. As a result, the pair rose slightly and went against the trend.
Trading recommendations for July 20
Pound fell on Monday after MPC member Jonathan Haskel said the Bank of England should already tighten monetary policy. Increasing COVID-19 cases caused by the delta strain also put pressure on the currency, and this could continue this week. Meanwhile, upcoming reports on the US construction sector are unlikely to shake the markets.
For long positions:
Open a long position when pound reaches 1.3687 (green line on the chart), and then take profit at the level of 1.3742 (thicker green line on the chart). But before buying, make sure that the MACD line is above zero, or is starting to rise from it.
It is also possible to buy at 1.3649 and 3605, but the MACD line should be in the oversold area in order to set off a market reversal to 1.3687.
For short positions:
Open a short position when pound reaches 1.3649 (red line on the chart), and then take profit at the level of 1.3605. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.
It is also possible to sell at 1.3687 and 1.3742, but the MACD line should be in the overbought area in order to trigger a market reversal to 1.3649.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.
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