Analysis of Trades and Trading Tips for the Euro

The price test at 1.1558 coincided with the moment when the MACD indicator had just started to rise from the zero line, confirming a valid entry point for buying the euro. As a result, the pair rose by more than 25 points.

The unexpected drop in the U.S. ISM Services PMI, published by the Institute for Supply Management, was the catalyst that triggered a wave across the currency markets. The reading of 50.1 points, which fell short of analysts' forecasts, indicates a slowdown in momentum in a key sector of the U.S. economy. This, in turn, fueled speculation about potential easing by the Federal Reserve. However, stronger pressure on the dollar was offset by good U.S. trade balance data, with the deficit narrowing slightly. This suggests that Donald Trump's tariffs are still having an effect.

This morning, data on changes in industrial orders in Germany and retail sales in the eurozone are expected to be released. These indicators are important for assessing the health of the European economy and are likely to influence future monetary policy decisions by the European Central Bank. Market participants and analysts will closely scrutinize this data to assess demand dynamics and the pace of economic recovery after recent challenges. Industrial orders in Germany — the eurozone's largest economy — are an important signal for future manufacturing activity. An increase in orders reflects optimism in the industrial sector and may signal growth in production and employment. Conversely, a decline in orders could indicate upcoming difficulties and a slowdown in the economic upturn. Retail trade trends in the eurozone serve as a reflection of consumer sentiment and activity, which are crucial drivers of economic growth. Rising retail sales suggest strengthening consumer confidence and willingness to spend, while a decline points to concern and potential economic headwinds.

For intraday strategy, I will focus primarily on Scenarios #1 and #2.

Buy Scenario

Scenario #1: Today, I plan to buy the euro upon reaching the price area around 1.1595 (green line on the chart), targeting a rise to 1.1632. At 1.1632, I plan to exit the market and sell the euro in the opposite direction, aiming for a 30–35 point move from the entry level. Expect euro strength only in the case of strong data.

Important: Before buying, make sure the MACD indicator is above the zero line and just beginning to rise from it.

Scenario #2: I also plan to buy the euro today in case of two consecutive tests of the 1.1573 price level at a time when the MACD indicator is in oversold territory. This would limit the pair's downside potential and trigger a reversal to the upside. A rise to resistance levels 1.1595 and 1.1632 can be expected.

Sell Scenario

Scenario #1: I plan to sell the euro after the price reaches the 1.1573 level (red line on the chart), with a target at 1.1534, where I will exit and immediately buy in the opposite direction, aiming for a 20–25 point move upward. Downward pressure on the pair may return if the economic data disappoints.

Important: Before selling, make sure the MACD indicator is below the zero line and just beginning to decline.

Scenario #2: I also plan to sell the euro today in case of two consecutive tests of the 1.1595 level while the MACD indicator is in overbought territory. This would limit the pair's upside potential and trigger a downward reversal. A decline toward 1.1573 and 1.1543 can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.