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Analysis of transactions in the EUR / USD pair
A signal to sell appeared in the market on Friday, but there was no downward movement even though the MACD line was below zero. It was only in the afternoon that EUR / USD fell by 30 pips, and afterwards there were no other market signals. The sharp surge in volatility after the data on US inflation prevented anything from developing.
Inflation data for Germany led to a slight decrease in euro last Friday, but the real highlight was the CPI report from the US. The figure for November came out as expected - 6.8%. Foreign trade balance in Germany also provoked a decrease in EUR / USD, as did the report on US jobless claims. Apparently, applications fell 43,000 compared to the previous week, reaching only 184,000 during the reporting week. As for the speeches made by ECB members Christine Lagarde, Jens Weidmann and Fabio Panetta, no one was surprised by their contents.
Most likely, the pair will trade sideways today, as there are no key reports expected to be released from the US and the eurozone. Germany's wholesale price index and Italy's quarterly unemployment rate are unlikely to affect market sentiment any way, so they can be ignored. The only thing that traders should pay attention to is the attempt of dollar bulls to push prices up before the Fed meeting this December.
For long positions:
Buy euro when the quote reaches 1.1305 (green line on the chart) and take profit at the price of 1.1343. Growth will be observed if there is consolidation above 1.1305.
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 1.1286, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.1305 and 1.1343.
For short positions:
Sell euro when the quote reaches 1.1286 (red line on the chart) and take profit at the price of 1.1253. Pressure is likely to return, especially if there is a breakout at 1.1286. Bears are also expected in the market due to Friday's US inflation report.
Before selling, make sure that the MACD line is below zero, or is starting to move down from it. Euro could also be sold at 1.1305, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.1286 and 1.1253.
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.
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