Relevance up to 02:00 2022-06-16 UTC–4
Analysis of transactions in the EUR / USD pair
EUR/USD reaching 1.0463 led to a buy signal in the market, however, having the MACD line far from zero limited the upside potential of the pair. Some time later, a similar situation took place, which ended with the pair falling to 1.0421. At that time, the MACD line was still far from zero, so the downside potential was also limited. It was only during the second test of the level that the pair fell by 20 pips as the MACD line, by that time, started to move below zero.
Although the situation is improving, statistics from Germany did not provide much support to euro yesterday. However, things may change today as the weak US PPI report for May is likely to affect the Fed’s decision on monetary policy. Even so, traders should still pay attention to reports on the eurozone, especially on trade balance and industrial production. Sluggish indicators will not hurt euro much, so expect an upward correction before the Fed meeting. The speeches of ECB members Fabio Panetta and Christine Lagarde may also raise EUR/USD higher, though it may dip in the afternoon after the release of US retail sales for May and Fed decision on interests. Economic forecasts and Jerome Powell’s press conference will also have a significant impact on the market.
For long positions:
Buy euro when the quote reaches 1.0489 (green line on the chart) and take profit at the price of 1.0540 (thicker green line on the chart). There is a chance for a rally today, but only after strong statistics on the euro area and hawkish statements by ECB representatives. Nevertheless, note that when buying, the MACD line should be above zero or is starting to rise from it. It is also possible to buy at 1.0440, but the MACD line should be in the oversold area as only by that will the market reverse to 1.0489 and 1.0540.
For short positions:
Sell euro when the quote reaches 1.0440 (red line on the chart) and take profit at the price of 1.0375. Pressure will return after the Fed raises its interest rate. However, 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 1.0489, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.0440 and 1.0375.
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 decisions 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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