Analysis of previous deals:
30M chart of the EUR/USD pair
The EUR/USD pair continued its not too strong downward movement on Wednesday after it failed to surpass the level of 1.2174 for the third time. The movement was not that strong, but the US inflation report for April was released in the afternoon, which frankly made the markets panic. As a result, after a few hours, it became clear that the bears still had the advantage, although on the 5-minute timeframe, novice traders will see that the pair was moving in different directions. Moreover, the inflation report was extremely unambiguous. That is, the forecasts were exceeded, there was no ambiguity and there could not be. This acceleration in inflation was supposed to trigger a fall in the US currency, but in reality, the US dollar has significantly strengthened. We believe that this is absolutely illogical market behavior and tomorrow the euro/dollar currency pair will grow, trying to close today's illogical state. Moreover, a clear upward trend is maintained on the 30-minute timeframe due to the uptrend line. Accordingly, buy signals from the MACD indicator continue to be relevant here, which were not formed during today (worthy of working out).
5M chart of the EUR/USD pair
Now let's take a look at the 5 minute timeframe. Here the picture is more complex, but at the same time more understandable. It is clearly seen that before the US session started, the pair was moving very calmly and even managed to form one buy signal - a rebound from the level of 1.2123. However, after its formation, the price went up only 15 points, which was enough to place a Stop Loss order at breakeven, at which the buy deal was closed. Further, the next signal was already at the borderline, as it was formed nearly when the US session opened. It shouldn't have been worked out any more, since US reports were to be released in half an hour and the market reaction was unpredictable. In practice, it turned out to be even more unpredictable than one could imagine. The most interesting thing is that two more signals formed within an hour after the inflation report was published and they were quite strong - the levels 1.2076 and 1.2150 were worked out perfectly and rebounds followed from them. But, despite all the attractiveness of these signals, we did not recommend beginners to trade when these important reports are published, so these signals and all subsequent ones should be ignored. As a result, there are no profits or losses today.
Trading tips for Thursday:
Novice traders have a clear trend on the 30-minute timeframe on Thursday, so you should continue to consider buy signals from the MACD indicator. This indicator is below the zero level, so in the near future it may form not quite accurate signals. In any case, it is not recommended to trade at night, and by tomorrow morning the situation may change. On the 5-minute timeframe, it is recommended to trade from the levels of 1.2027, 1.2044, 1.2056 and 1.2092. Take Profit, as before, is set at a distance of 30-40 points at 30M. Stop Loss to break even when the price passes in the right direction 15-20 points. The target at the 5M TF is the nearest level, if it is not located too close or too far away. If it is located then you should act on the situation. Recall that it is best to trade using the most accurate and clear signals, and to ignore inaccurate ones. On Thursday, we recommend that novice traders pay attention to the report on applications for unemployment benefits in the United States. But the reaction to this report will follow only if the actual value is very different from the forecast. And in general, this is not the most important report for the forex market right now.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.
The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
