Trade Breakdown and Tips for Trading the Euro

The test of the 1.1405 price level occurred just as the MACD indicator began moving upward from the zero line, confirming a valid entry point for buying the euro and resulting in a 30-point rise.

Disappointing PMI index readings across eurozone countries did not trigger a noticeable drop in the euro. Most likely, market participants had already priced in the expected slowdown in regional economic growth, leading to a muted response. In the short term, the euro's trajectory will be shaped by multiple factors, including today's US data and further developments in Trump's trade confrontation with key partners.

In the second half of the day, attention will shift to similar reports from the United States. Only strong readings in US manufacturing and services PMI figures could restore pressure on the euro and support the dollar. Otherwise, if signs of a slowdown emerge in the US economy, the euro may temporarily strengthen.

As for the intraday strategy, I will primarily rely on the implementation of scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy the euro today upon reaching the price level of 1.1412 (green line on the chart) with the goal of rising toward 1.1465. At 1.1465, I plan to exit the market and also sell the euro in the opposite direction, targeting a 30–35 point move from the entry point. Expect euro strength only after weak US data. Important: Before buying, make sure the MACD indicator is above the zero line and just beginning to rise from it.

Scenario #2: I also plan to buy the euro today if there are two consecutive tests of the 1.1382 level, at a time when the MACD indicator is in the oversold area. This will limit the pair's downward potential and trigger a reversal upward. A rise to the opposite levels of 1.1412 and 1.1465 can be expected.

Sell Signal

Scenario #1: I plan to sell the euro after reaching the 1.1382 level (red line on the chart). The target will be 1.1324, where I will exit the market and buy in the opposite direction (aiming for a 20–25 point rebound from that level). Pressure on the pair will return today in the case of strong data. Important: Before selling, ensure 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 if there are two consecutive tests of the 1.1412 level, at a time when the MACD indicator is in the overbought area. This will limit the pair's upward potential and trigger a reversal downward. A drop to the opposite levels of 1.1382 and 1.1324 can be expected.

Chart Key:

• Thin green line – entry price to buy the instrument;
• Thick green line – estimated price for placing Take Profit or manually securing profits, as further growth is unlikely above this level;
• Thin red line – entry price to sell the instrument;
• Thick red line – estimated price for placing Take Profit or manually securing profits, as further declines are unlikely below this level;
• MACD Indicator – when entering the market, it's important to follow overbought and oversold conditions.

Important: Beginner Forex traders should exercise extreme caution when deciding to enter the market. It's best to stay out of the market ahead of significant fundamental reports to avoid sharp price swings. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-losses, your entire deposit could be wiped out quickly—especially if you trade large volumes without proper money management.

And remember, successful trading requires a well-defined trading plan, like the one I've outlined above. Making spontaneous trading decisions based on current market sentiment is an inherently losing strategy for intraday traders.