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22.01.202111:19 Forex Analysis & Reviews: Analysis and trading recommendations for the EUR/USD and GBP/USD pairs on January 22

Analysis of transactions in the EUR / USD pair

Three signals emerged in EUR / USD yesterday. However, not all of them were profitable, and some should have been ignored altogether. Anyhow, the first one is to sell the euro at 1.2120, which did not lead to the desired result even though the MACD line was in a negative zone. The second signal was to buy the euro, but it had to be ignored, since the MACD line, at that time, was in the overbought zone. Meanwhile, the third one is again to buy in the market, and this time it led to a rise of about 25 pips. Unfortunately, the quote failed to reach the target level.

Exchange Rates 22.01.2021 analysis

Trading recommendations for January 22

EUR / USD did not rally yesterday because the ECB announced an expected double recession for the EU economy. Aside from that, the latest report for the US labor market was better than expected, so the dollar did not decline much in the market.

Meanwhile, a number of economic reports are scheduled to come out today, which may lead to the growth of the euro, provided that the data turn out to be better than projected. Similar data will also be published for the US economy.

For long positions:

Buy the euro when the quote reaches 1.2179 (green line on the chart), and then take profit around the level of 1.2214. EUR / USD will rally if the upcoming economic data comes out better than expected.

But keep in mind that before buying, the MACD line should be above zero and is starting to rise from it.

For short positions:

Sell the euro after the quote reaches 1.2161 (red line on the chart), and then take profit at the level of 1.2130. EUR / USD will trade downwards if the upcoming economic data comes out weaker than expected.

Of course, before selling, it is important to make sure that the MACD line is below zero and is starting to move down from it.

Exchange Rates 22.01.2021 analysis

What's on the chart:

The thin green line is the key level at which you can place long positions in the EUR / USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the EUR / USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

Analysis of transactions in the GBP / USD pair

A buy signal appeared on GBP / USD yesterday, however, it was quite contradictory since on the one hand, the trend is still upward, but on the other hand, the MACD line was close to entering the overbought zone.

Exchange Rates 22.01.2021 analysis

Trading recommendations for January 22

A number of macro statistics are scheduled to be published today, and they will surely influence market sentiment in GBP / USD. In fact, many expect that they will put significant pressure on the British pound.

For long positions:

Buy the pound when the quote reaches 1.3714 (green line on the chart), and then take profit at the level of 1.3754 (thicker green line on the chart). GBP / USD will trade upwards if the upcoming economic reports are better than expected.

But keep in mind that before buying, make sure that the MACD line is above zero and is starting to rise from it.

For short positions:

Sell the pound after the quote reaches 1.3687 (red line on the chart), and then take profit at the level of 1.3628. GBP / USD will trade downwards if data on retail sales came out weaker than expected.

Keep in mind that before selling, make sure that the MACD line is below zero and is starting to move down from it.

Exchange Rates 22.01.2021 analysis

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Jakub Novak,
Analytical expert
InstaForex Group © 2007-2021
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