Relevance up to 03:00 2022-07-15 UTC–4
Analysis of transactions in the EUR / USD pair
EUR/USD tested 1.0020 on Wednesday. At that time, the MACD line was just starting to move below zero, so selling was quite appropriate. However, there was no downward movement, so short positions led to losses. Some time later, euro tested 1.0064, but this time the MACD line was far from zero. That situation limited the upside potential of the pair. Another test of the level occurred during the time that the MACD line was in the overbought area. This led to more than a 60-pip increase in the pair, which offset the previous losses.
Industrial output and inflation reports in the Euro area were ignored by markets as traders were more focused on the June CPI data in the US. The latter jumped to 9.1%, raising demand for the dollar ahead of further policy decisions by the Fed.
There are no reports that could support euro today, so expect EUR/USD to fall along the trend. In the afternoon, the US will release a report on producer prices, which is expected to show a slight slowdown amid declining energy costs. Following that are weekly jobless claims data, as well as a speech from Fed member Christopher Waller.
For long positions:
Buy euro when the quote reaches 1.0032 (green line on the chart) and take profit at the price of 1.0081 (thicker green line on the chart). There is a chance for a rally today, but only in the afternoon as there are no good reasons for growth during the European session. And take note that when buying, the MACD line should be above zero or is starting to rise from it. Euro can also be bought at 1.0000, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0032 and 1.0081.
For short positions:
Sell euro when the quote reaches 1.0000 (red line on the chart) and take profit at the price of 0.9964. Pressure will continue as there are no reasons for growth in risky assets at the moment. Also, strong statistics on the US will return the demand for dollar. And take note that when selling, the MACD line should be below zero or is starting to move down from it. Euro can also be sold at 1.0032, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.0000 and 0.9964.
What’s on the chart:
The thin green line is the key level at which you can place long positions in the EUR/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the EUR/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line – when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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