Analysis of Trades and Trading Tips for the Euro

The price test at 1.0351 occurred when the MACD indicator had already risen significantly above the zero mark, which limited the euro's potential for upward movement. For this reason, I decided against entering any buy trades, and did not wait for other market entry points.

Despite the dollar's decline yesterday, traders believe this weakness is likely to be temporary, given the relative strength of the U.S. economy and the risks associated with the trade war that may drive investors toward safe-haven assets.

The dollar weakened after President Donald Trump postponed tariffs on Mexico and Canada. Additionally, recent comments from the Federal Reserve regarding their commitment to a looser monetary policy have left traders confused.

A series of important Eurozone data is set to be released today. If the data is strong, it could boost investor sentiment, leading to an increase in the euro's value against the dollar and other currencies. Improvements in the Purchasing Managers' Index (PMI) figures could indicate a recovery in the Eurozone's services sector, signaling a more stable economic growth. However, it is essential to consider external factors. Geopolitical instability or new U.S. trade tariffs could affect the market and diminish any positive effects from strong PMI figures.

Additionally, the Eurozone Producer Price Index (PPI) will be published today. If it exceeds expectations, it will indicate rising inflationary pressures, raising concerns about the likelihood of further monetary easing. Overall, the upcoming data could serve as a catalyst for euro movements in the first half of the day.

I will rely primarily on implementing Scenario #1 and Scenario #2 for today's trading plan.

Buy Signal

Scenario #1: I plan to buy the euro at 1.0402 (green line on the chart) with a target of 1.0444. At 1.0444, I plan to exit long positions and initiate short trades, aiming for a 30-35 pip pullback from the entry point. After strong economic data, a bullish outlook for the euro in the first half of the day is possible. Important: Before buying, ensure the MACD indicator is above the zero line and just beginning to rise.

Scenario #2: I will also consider buying the euro if the price tests 1.0369 twice consecutively while the MACD is in oversold territory. This will limit the pair's downward potential and lead to a market reversal to the upside. The expected targets are 1.0402 and 1.0444.

Sell Signal

Scenario #1: I plan to sell the euro after the price reaches 1.0369 (red line on the chart), targeting 1.0321. At 1.0321, I will exit short positions and immediately switch to buy trades, aiming for a 20-25 pip rebound from the entry level. Downward pressure on the pair may return at any time. Important: Before selling, ensure the MACD indicator is below the zero line and beginning to decline.

Scenario #2: I will also consider selling the euro if the price tests 1.0402 twice consecutively while the MACD is overbought territory. This will limit the pair's upward potential and lead to a market reversal to the downside. The expected targets are 1.0369 and 1.0321.

Chart Notes

• Thin green line: Entry price for buying the trading instrument.
• Thick green line: A suggested target for Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line: Entry price for selling the trading instrument.
• Thick red line: A suggested target for Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD Indicator: Critical for identifying overbought and oversold zones to guide market entry decisions.

Important Note for Beginner Traders

• Always approach market entry decisions cautiously.
• Avoid trading during major news releases to sidestep volatile price swings.
• If trading during news releases, always set stop-loss orders to minimize losses.
• Trading without stop-loss orders or money management practices can quickly deplete your deposit, especially when using large volumes.
• A clear trading plan, like the one outlined above, is essential for successful trading. Spontaneous trading decisions based on current market conditions are inherently disadvantageous for intraday traders.