Analysis of Trades and Trading Tips for the Euro

The test of the 1.1168 level occurred when the MACD indicator had already risen significantly above the zero line, limiting the euro's upward potential. As a result, the buying opportunity was missed, along with the entire upward move.

The euro recovered considerably against the U.S. dollar following the decline at the end of last week. At that time, a strong U.S. labor market report, which showed an increase in employment of 165,000 compared with the forecast of 65,000, while the unemployment rate fell to 4.1%, discouraged buyers. Market sentiment has changed today. Demand for the U.S. dollar, which had been supported by expectations of a Fed rate hike in December, has weakened, while European economic data turned out to be less disappointing than feared. The Sentix index for November came in at 2.4, compared with the forecast of 1.8. Although Germany's trade balance disappointed, coming in at €15.6 billion against expectations of €18.1 billion, the market did not focus on this result.

The main event for the U.S. dollar will take place later today. The only U.S. economic release will be wholesale inventories, with a forecast of 0.6%. However, Fed officials Austan Goolsbee and Thomas Barkin are also scheduled to speak. Their comments following the labor market report are particularly important. Barkin's position is already known. Last week, he reaffirmed his support for a gradual pace of rate increases without specifying a target rate. Today, the market will be looking for further clarification. If Goolsbee supports his position, the EUR/USD pair may decline.

Regarding the intraday trading strategy, the focus will be primarily on implementing Scenarios #1 and #2.

Buy Signal

Scenario #1: Today, the euro can be bought if the price reaches the 1.1198 level (the green line on the chart), with an upward target at 1.1217. At 1.1217, the position is planned to be closed, followed by a potential reversal into a short position, targeting a move of 30–35 points from the entry point. The euro may rise today if U.S. economic data comes in weaker than expected.

Important! Before buying, make sure that the MACD indicator is above the zero line and has only just begun to rise from it.

Scenario #2: The euro can also be bought today if the price tests the 1.1188 level twice consecutively while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and trigger an upward market reversal. The pair could then rise toward the opposite levels of 1.1198 and 1.1217.

Sell Signal

Scenario #1: The euro is expected to be sold after the price reaches 1.1188 (the red line on the chart). The target will be 1.1171, where the position is planned to be closed, followed by an immediate reversal into a long position, targeting a move of 20–25 points in the opposite direction from that level. Selling pressure on the pair may return if U.S. economic data exceeds expectations.

Important! Before selling, make sure that the MACD indicator is below the zero line and has only just begun to decline from it.

Scenario #2: The euro can also be sold today if the price tests the 1.1198 level twice consecutively while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and trigger a downward market reversal. The pair could then decline toward the opposite levels of 1.1188 and 1.1171.

What the Chart Shows

• Thin green line – the entry price at which the trading instrument can be bought.
• Thick green line – the estimated price level at which Take Profit can be set or profits can be closed manually, as further gains above this level are considered unlikely.
• Thin red line – the entry price at which the trading instrument can be sold.
• Thick red line – the estimated price level at which Take Profit can be set or profits can be closed manually, as further declines below this level are considered unlikely.
• MACD indicator – when entering the market, it is important to consider overbought and oversold conditions.

Important

Beginner Forex traders should exercise considerable caution when making entry decisions. Before the release of major fundamental reports, it is generally preferable to stay out of the market to avoid exposure to sharp exchange rate fluctuations. If trading during news releases, always use stop-loss orders to minimize potential losses. Without stop-loss orders, the entire trading account can be lost very quickly, especially when position sizes are large and proper money management is not applied.

It is also important to remember that successful trading requires a clear trading plan, such as the one outlined above. Making spontaneous trading decisions based on current market conditions is an inherently unprofitable strategy for intraday traders.