Trade Analysis and Tips for the Euro

The test of the 1.0842 level occurred when the MACD indicator had already moved significantly above the zero mark, which limited the pair's upward potential. For this reason, I did not buy the euro. The second test of 1.0842 shortly afterward, when the MACD was in the overbought zone, triggered Scenario #2 for selling, which resulted in a modest 10-point decline.

Rather mediocre PMI data from the eurozone failed to support further euro growth against the dollar, though a major decline also did not materialize. Despite a few positive reports, the overall picture remains mixed. The manufacturing sector continues to struggle, while the services sector shows only moderate growth. This raises doubts about the European Central Bank's ability to keep rates unchanged at their current levels.

At the same time, the US dollar is supported by the Federal Reserve's hawkish rhetoric and expectations of a stricter stance on interest rates. Today, investors will closely watch macroeconomic data to assess the state of the US economy and the Fed's likely policy direction. Stronger-than-expected PMI figures could reinforce expectations of a hawkish Fed and support the US dollar. Speeches from Bostic and Barr will also attract market attention as investors look for clues about the Fed's future rate plans. If FOMC members advocate for maintaining high rates to fight inflation, this could further strengthen the dollar.

As for the intraday strategy, I will mainly rely on Scenarios #1 and #2.

Buy Signal

Scenario #1: Today, I plan to buy the euro upon reaching the 1.0860 level (green line on the chart) with the goal of rising to 1.0910. At 1.0910, I plan to exit the market and sell the euro in the opposite direction, aiming for a 30–35 point reversal. Euro growth today is only likely after dovish comments from Fed officials. Important! Before buying, make sure the MACD indicator is above the zero line and just starting to rise from it.

Scenario #2: I also plan to buy the euro today if there are two consecutive tests of the 1.0815 level while the MACD is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upward. A rise to the opposite levels of 1.0860 and 1.0910 can then be expected.

Sell Signal

Scenario #1: I plan to sell the euro after it reaches the 1.0815 level (red line on the chart). The target will be 1.0766, where I plan to exit the market and buy immediately in the opposite direction (aiming for a 20–25 point rebound). Pressure on the pair could return if the Fed maintains a hawkish stance. Important! Before selling, make sure the MACD is below the zero line and just starting to decline from it.

Scenario #2: I also plan to sell the euro today if there are two consecutive tests of the 1.0860 level while the MACD is in the overbought zone. This will limit the pair's upward potential and trigger a downward reversal. A decline to the opposite levels of 1.0815 and 1.0766 can then be expected.

Chart Elements Explanation:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated price for setting Take Profit or manually locking in profit, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated price for setting Take Profit or manually locking in profit, as further decline below this level is unlikely;
• MACD indicator – it's important to use overbought and oversold zones when entering the market.

Important: Beginner Forex traders should be extremely cautious when making market entry decisions. It's best to stay out of the market before important fundamental reports to avoid getting caught in sharp price swings. If you choose to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you don't practice money management and trade with large positions.

And remember, successful trading requires a clear trading plan—such as the one outlined above. Spontaneous trading decisions based on current market sentiment are an inherently losing strategy for intraday traders.