Analysis of transactions and tips for trading EUR/USD

When the pair tested 1.0636, the MACD line was already far from zero, so the downside potential was limited. Similarly, when the level of 1.0681 was tested in the afternoon, the MACD line was also away from zero, limiting the upside potential.

PPI data in Germany fell much less than expected. It also rose in terms of year-on-year figure, prompting speculation about the need for further rate hikes in the eurozone. Hawkish comments from ECB President Christine Lagarde also led to a stronger rally in EUR/USD during the US session.

Today, reports on business sentiment and present situation from the ZEW institute are scheduled to be released which, if shows a decline, will weaken euro and limit the rise in the pair. However, a speech by Lagarde may bring back risk appetite, especially since no important statistics are expected from the US except for the secondary market housing sales. That means that there will be no sharp movements in the forex market as players most likely await the Fed's interest rate decision tomorrow.

For long positions:

Buy euro when the quote reaches 1.0720 (green line on the chart) and take profit at the price of 1.0761. Further growth will continue the bull market; however, make sure that when buying, the MACD line is above zero or is starting to rise from it. Euro can also be bought at 1.0690, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0720 and 1.0761.

For short positions:

Sell euro when the quote reaches 1.0690 (red line on the chart) and take profit at the price of 1.0653. Pressure will return if ECB chief Christine Lagarde withdraws from her tough stance on monetary policy. However, when selling, make sure that the MACD line is under zero or is starting to move down from it. Euro can also be sold at 1.0720, but the MACD line should be in the overbought area as only by that will the market reverse to 1.0690 and 1.0653.

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 decision based on the current market situation is an inherently losing strategy for an intraday trader.