Analysis of Trades and Trading Tips for the Euro

The test of the 1.1575 level occurred when the MACD indicator had already moved significantly below the zero mark, which limited the pair's downside potential. For that reason, I did not sell. A second test of 1.1575 while the MACD was in oversold territory allowed for the execution of Buy Scenario #2, which resulted in a 25-pip rise in the pair.

Yesterday's strong U.S. retail sales data for June supported the dollar. The increase, which exceeded analysts' expectations, was viewed by the market as a sign of the U.S. economy's resilience despite persistent inflation. The dollar strengthened following the data release, putting pressure on other currencies, particularly the euro. The EUR/USD pair — traditionally used as a barometer of global economic sentiment — reacted immediately by declining, reflecting ongoing bearish sentiment.

Today's European trading session will start with a focus on economic news from Europe. In the first half of the day, investors will focus on the release of Germany's Producer Price Index (PPI) data. This indicator, which reflects inflation in the manufacturing sector, can significantly influence European Central Bank (ECB) policy decisions. If the PPI exceeds expectations, it could raise concerns about persistent inflationary pressure and prompt the ECB to take a more cautious stance on interest rate cuts.

Simultaneously, a report on the ECB's current account balance will be published. This indicator, which shows the difference between incoming and outgoing payments in the eurozone, is a crucial factor in assessing financial stability. The day will conclude with a speech by Bundesbank President Joachim Nagel. His comments will be particularly significant given his recent support for a more conservative approach to rate cuts. Market participants will carefully analyze his remarks for hints about the ECB's future monetary policy and possible timing for its adjustment. Any signals suggesting a pause in the rate-cutting cycle may support the euro.

For intraday strategy, I will focus primarily on Scenarios #1 and #2.

Buy Scenario

Scenario #1: Today, I plan to buy the euro when the price reaches the area of 1.1630 (green line on the chart), targeting a rise toward 1.1670. At the 1.1670 mark, I plan to exit the market and sell the euro in the opposite direction, aiming for a 30–35 pip move from the entry point. Today's euro rise is likely to occur only within a correction.

Important! Before buying, ensure that the MACD indicator is above the zero line and just beginning to rise from it.

Scenario #2: I also plan to buy the euro in case of two consecutive tests of the 1.1609 price while the MACD indicator is in oversold territory. This will limit the pair's downside potential and trigger a market reversal to the upside. A rise toward the opposite levels of 1.1630 and 1.1670 can be expected.

Sell Scenario

Scenario #1: I plan to sell the euro after the price reaches 1.1609 (red line on the chart). The target will be 1.1575, where I plan to exit the market and immediately buy in the opposite direction (aiming for a 20–25 point move back 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 line and just beginning to decline from it.

Scenario #2: I also plan to sell the euro today in case of two consecutive tests of the 1.1630 price while the MACD indicator is in overbought territory. This will limit the pair's upside potential and trigger a market reversal to the downside. A decline toward the opposite levels of 1.1609 and 1.1575 can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.