Trade Analysis and Tips for Trading the Euro

The price test at 1.193 occurred at a moment when the MACD indicator had already moved significantly below the zero line, which limited the downward potential of the pair. For this reason, I did not sell the euro.

Today, Eurostat published final April inflation data for the eurozone, confirming earlier estimates. According to the report, the annual inflation rate in the region accelerated to 3.0% in April compared to 2.6% in March. This is the highest level since September 2023 and slightly exceeded analysts' expectations of 2.9%.

The main driver of this acceleration was the energy sector: fuel prices rose by 10.9% year-on-year, compared to 5.1% in March. This sharp jump in energy prices is the largest since February 2023 and is fully explained by tensions in the Middle East.

At the same time, underlying inflation indicators showed a more stable picture. Core CPI, which excludes energy, food, alcohol, and tobacco, declined from 2.3% to 2.2%. Inflation in the services sector also slowed, coming in at 3.0% compared to 3.2% a month earlier. The euro did not react to this data.

Next, market participants will focus on the minutes of the Federal Reserve's May meeting. Investors will carefully analyze the document for hints about how seriously committee members considered the possibility of raising interest rates amid accelerating price growth.

The second key event will be a speech by FOMC member Michael Barr. Based on his previous comments, the key risk for the U.S. economy is inflation, and its unpredictability is what concerns him most. If policymakers confirm a hawkish stance, this will support the U.S. dollar.

As for the intraday strategy, I will rely more on scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, buying the euro is possible when the price reaches around 1.1611 (green line on the chart), with a target of 1.1637. At 1.1637, I plan to exit the market and potentially sell in the opposite direction, expecting a 30–35 point move from the entry point. Euro growth today is only possible after weak U.S. data.Important: Before buying, ensure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2: I also plan to buy the euro if there are two consecutive tests of the 1.1587 level while the MACD is in oversold territory. This would limit downward potential and trigger a reversal upward. Growth toward the opposite levels of 1.1611 and 1.1637 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after reaching 1.1587 (red line on the chart), targeting 1.1562, where I will exit the market and immediately buy in the opposite direction (expecting a 20–25 point rebound). Pressure on the pair today will return with strong U.S. data.Important: Before selling, ensure that the MACD is below the zero line and just beginning to decline from it.

Scenario No. 2: I also plan to sell the euro if there are two consecutive tests of 1.1611 while the MACD is in overbought territory. This would limit upward potential and trigger a reversal downward. A decline toward 1.1587 and 1.1562 can be expected.

What Is on the Chart:

• Thin green line – entry price for buying the trading instrument
• Thick green line – estimated take-profit level or area to lock in profit, as further growth above this level is unlikely
• Thin red line – entry price for selling the trading instrument
• Thick red line – estimated take-profit level or area to lock in profit, as further decline below this level is unlikely
• MACD indicator – trading decisions should consider overbought and oversold zones

Important Note

Beginner Forex traders should be very cautious when entering the market. Before major fundamental releases, it is best to stay out of the market to avoid sharp volatility. If you choose to trade during news events, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

And remember: successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based on current market conditions are generally a losing strategy for intraday traders.