Trade Analysis and Tips for Trading the Euro

The test of the 1.1633 price coincided with the MACD indicator moving significantly below the zero mark, which limited the pair's downward potential. For this reason, I did not sell the euro. The second test at 1.1633 prompted the implementation of Scenario #2 to buy euros, but the anticipated growth in the pair did not materialize.

Yesterday's data showed that the U.S. consumer confidence index dropped to 93.1 points in May due to rising prices, which applied slight pressure on the dollar. This factor, though minor, added to the overall market nervousness caused by the escalation of the Middle Eastern conflict. Clearly, traders will continue to closely monitor any signs of weakening consumer demand in the world's largest economy, as this could affect future interest rates and the broader global economy.

Today, in the first half of the day, there are no macroeconomic data from the Eurozone, so traders' attention is likely to focus on the Middle East and the prospect of peace between the U.S. and Iran. Geopolitical tension, even with hints of resolution, remains a key driver of market sentiment, much more so than minor statistical data. Any news related to the negotiations could cause significant fluctuations in the currency market.

As for the intraday strategy, I will be focusing more on implementing Scenarios #1 and #2.

Buy Scenarios

• Scenario #1: I plan to buy euros today when the price reaches around 1.1650 (the green line on the chart), targeting a move to 1.1678. At 1.1678, I plan to exit the market and sell euros immediately on the bounce, anticipating a movement of 30-35 pips from the entry point. Growth in the euro can only be expected after good news regarding the agreement. Important! Before buying, ensure that the MACD indicator is above the zero mark and just beginning to rise from it.
• Scenario #2: I also intend to buy euros today if the price tests 1.1633 twice in a row while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. We can expect growth to the opposing levels of 1.1650 and 1.1678.

Sell Scenarios

• Scenario #1: I plan to sell euros after the level of 1.1633 is reached (the red line on the chart), targeting a drop to the level of 1.1601, where I intend to exit the market and buy immediately in the opposite direction, anticipating a movement of 20-25 pips in the opposite direction from the level. Pressure on the pair could return at any moment today. Important! Before selling, ensure that the MACD indicator is below the zero mark and just beginning to decline from it.
• Scenario #2: I also plan to sell euros today if the price tests 1.1650 twice in a row while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a market reversal downward. We can expect a decline to the opposing levels of 1.1633 and 1.1601.

What the Chart Indicates:

• Thin Green Line: Entry price for buying the trading instrument;
• Thick Green Line: Estimated price where take profit can be set or profits can be locked in, 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 profits can be locked in, as further decline below this level is unlikely;
• MACD Indicator: When entering the market, it's important to consider the overbought and oversold zones.

Important Note:

Novice Forex traders must be very cautious when making market entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid sharp 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 use money management and trade large volumes.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.