Review of Trades and Trading Advice for the Euro

The first test of the 1.0478 level occurred when the MACD indicator had already moved significantly above the zero mark, which limited the pair's upward potential. For this reason, I did not buy the euro at that point. The second test of 1.0478 happened when MACD was in the overbought zone, triggering Scenario #2 for selling the euro. However, as seen on the chart, the expected downward movement did not materialize fully.

Data on credit activity in the Eurozone was not significant enough to impact the forex market, as demonstrated by the low trading volume in the first half of the day. In the second half of the session, attention will shift to revised US GDP growth figures for Q4. A stronger-than-expected GDP print could boost the US dollar, while a weaker reading might increase demand for EUR/USD, leading to a potential upward move. Additionally, weekly jobless claims data and the core personal consumption expenditures (PCE) index will be closely watched by traders.

Investors are paying particular attention to these macroeconomic indicators to assess the Federal Reserve's future monetary policy. A strong economy and tight labor market could push the Fed toward a more aggressive stance, supporting the US dollar. Conversely, signs of slowing economic growth and declining inflation could encourage the Fed to adopt a more cautious approach, which may pressure the greenback.

For my intraday strategy, I will focus primarily on executing Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: I plan to buy the euro at 1.0491 (green line on the chart), targeting a rise to 1.0520. At 1.0520, I will exit long positions and initiate short positions for a 30-35 point pullback. The bullish outlook is only valid if US economic data disappoints.

Important: Before entering a long position, ensure the MACD indicator is above the zero line and just starting to rise from it.

Scenario #2: I also plan to buy the euro if there are two consecutive tests of 1.0469, provided MACD is in the oversold area. This should limit the pair's downward potential and trigger a rebound toward 1.0491 and 1.0520.

Sell Signal

Scenario #1: I will consider selling the euro if the price falls to 1.0469 (red line on the chart), aiming for a decline to 1.0436. At 1.0436, I plan to exit short trades and buy the euro back, expecting a 20-25 point rebound. Selling pressure on EUR/USD could intensify if the Fed's rhetoric remains hawkish.

Important: Before entering a short position, ensure MACD is below the zero line and just starting to decline.

Scenario #2: I will also sell the euro if there are two consecutive tests of 1.0491, with MACD in the overbought zone. This should limit the pair's upward potential and trigger a reversal toward 1.0469 and 1.0436.

Key Levels on the Chart

• Thin green line: Entry price for long trades.
• Thick green line: Expected Take Profit level or potential resistance, where further growth is unlikely.
• Thin red line: Entry price for short trades.
• Thick red line: Expected Take Profit level or potential support, where further declines are unlikely.
• MACD Indicator: Signals overbought and oversold conditions.

Trading Tips for Beginners

Beginner traders should exercise caution when entering the market, especially before the release of key economic reports. Avoid trading during major news releases to prevent excessive volatility. If you do trade around news events, always use stop-loss orders to limit potential losses. Failure to use stop losses can quickly deplete your trading account, particularly when trading large positions without proper risk management.

For consistent success, traders need a clear trading plan, similar to the one outlined above. Spontaneous trading decisions, based purely on short-term market movements, are a losing strategy for intraday traders.