Analysis of Trades and Tips for Trading the Euro

The price test at 1.1656 coincided with the moment when the MACD indicator was beginning to move down from the zero mark, confirming the correct entry point for selling the euro. As a result, the pair declined by 10 pips.

The mixed nature of the U.S. economic data did not prevent the dollar from strengthening, though the move was restrained. On the one hand, the economy is slowing, as GDP in the second quarter grew by only 1.5% compared to 2.1% in the first quarter. On the other hand, the inflation section of the report was moderately encouraging for the Federal Reserve, which offset growth weakness and allowed the U.S. currency to strengthen. The PCE price index and its core version rose by 0.2% month-on-month, with annual figures of 3.7% and 3.3%, respectively. The core figure, which excludes volatile food and energy prices, more accurately reflects sustained pressure, and its moderate dynamics did not raise alarm. As all values fell within forecasts, the market perceived the report calmly.

Today, the euro enters the first half of the day with its sights set on data on private-sector credit and the M3 money supply, while the main event will be the European Central Bank report from the monetary policy meeting. Credit and money supply indicators reflect economic activity and the dynamics of money circulation; however, their significance is overshadowed by the publication of the minutes, which provides the market with real insights into the central bank's mood and helps adjust rate expectations. This report has the potential to trigger a spike in volatility, as many expect to see more hawkish sentiment from the central bank. Confirmation of a hawkish stance will bolster expectations for policy tightening and give the EUR/USD pair upward momentum, while cautious wording may disappoint buyers of the single currency.

Regarding the intraday strategy, I will rely more on implementing Scenarios No. 1 and No. 2.

Buying Scenarios

Scenario No. 1: Today, the euro can be bought when the price reaches around 1.1662 (the green line on the chart), with the aim of rising to 1.1685. At 1.1685, I plan to exit the market and also sell the euro in the opposite direction, anticipating a move of 30-35 pips from the entry point. One can expect the euro to rise in continuation of the trend. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just beginning its upward movement from there.

Scenario No. 2: I also plan to buy the euro today in the event of two consecutive tests of 1.1650, with the MACD indicator in the oversold area. This will limit the downside potential of the pair and lead to an upward market reversal. One can expect a rise to the opposite levels of 1.1662 and 1.1685.

Selling Scenarios

Scenario No. 1: I plan to sell the euro after the level of 1.1650 (the red line on the chart) is reached. The target will be 1.1629, where I plan to exit the market and immediately buy in the opposite direction (anticipating a move of 20-25 pips in the opposite direction). Pressure on the pair today will return with weak data. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning its downward movement from there.

Scenario No. 2: I also plan to sell the euro today if there are two consecutive tests of 1.1662, with the MACD indicator in the overbought area. This will limit the upside potential of the pair and lead to a downward market reversal. One can expect a decline to the opposing levels of 1.1650 and 1.1629.

What the Chart Shows:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated price where take profit can be set, or profit can be realized, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated price where take profit can be set, or profit can be realized, as further decline below this level is unlikely;
• MACD Indicator. When entering the market, it is important to be guided by overbought and oversold zones.

Important: Beginner forex traders need to make entry decisions very cautiously. Before key fundamental reports are released, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not practice money management and trade large volumes.

And remember, successful trading requires a clear trading plan, as outlined above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.