Analysis of Trades and Trading Tips for the Euro

A test of the 1.0505 level occurred when the MACD indicator had already moved significantly above the zero mark, limiting the pair's upward potential. For this reason, I did not buy the euro. No other entry points into the market materialized.

Today's focus will be on December PMI data for the eurozone, including the manufacturing, services, and composite PMI. A decline in these indicators could negatively impact market sentiment regarding the eurozone economy, which has already struggled with weak figures in recent months. This may heighten concerns about slowing growth rates.

Market participants will closely scrutinize these figures as they provide insights into the industry's actual state. If the data falls short of expectations, particularly in the manufacturing sector, it could increase pressure on the euro. Special attention will be paid to the breakdown of the indices: continued weakness in manufacturing could signal falling demand for goods, which may further hurt employment and production capacity. At the same time, resilience or growth in the services PMI could provide some optimism.

The market remains cautiously optimistic, with some experts suggesting that declining activity in the manufacturing sector could be temporary and that the recent rate cuts by the European Central Bank might support recovery.

As for the intraday strategy, I will rely more on Scenario #1 and Scenario #2 for trading.

Buy Signal

Scenario #1:

Today, I plan to buy the euro at 1.0524 (green line on the chart) with a target of 1.0554. At 1.0554, I plan to exit the market and open a sell position in the opposite direction, aiming for a movement of 30–35 pips from the entry-level. The euro will likely rise today during the first half of the day only after strong data from the eurozone.

Important! Before buying, ensure the MACD indicator is above the zero mark and starting to rise.

Scenario #2:

I also plan to buy the euro today in case of two consecutive tests of the 1.0509 level, provided the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth can be expected to the opposite levels of 1.0524 and 1.0554.

Sell Signal

Scenario #1:

I plan to sell the euro after reaching the level of 1.0509 (red line on the chart). The target will be 1.0485, where I plan to exit the market and open a buy position in the opposite direction, aiming for a movement of 20–25 pips in the opposite direction from the level. Downward pressure on the pair may resume, but selling from as high a level is better.

Important! Before selling, ensure the MACD indicator is below the zero mark and just starting to decline from there.

Scenario #2:

I also plan to sell the euro today if the MACD indicator is in the overbought area and the pair tests the 1.0524 level twice consecutively. This will limit the pair's upward potential and lead to a market reversal downward. Declines can be expected to the opposite levels of 1.0509 and 1.0485.

Chart Notes

• Thin green line: Entry price for buying the trading instrument.
• Thick green line: A suggested target for Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line: Entry price for selling the trading instrument.
• Thick red line: A suggested target for Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD Indicator: Critical for identifying overbought and oversold zones to guide market entry decisions.

Important Note for Beginner Traders

• Always approach market entry decisions cautiously.
• Avoid trading during major news releases to sidestep volatile price swings.
• If trading during news releases, always set stop-loss orders to minimize losses.
• Trading without stop-loss orders or money management practices can quickly deplete your deposit, especially when using large volumes.
• A clear trading plan, like the one outlined above, is essential for successful trading. Spontaneous trading decisions based on current market conditions are inherently disadvantageous for intraday traders.