Trade analysis and trading tips for the euro

The price test at 1.1422 occurred at a moment when the MACD indicator had just started moving downward from the zero line, which confirmed a correct entry point into the market. As a result, the pair declined by only 10 points, and that was the end of the move.

Eurozone data came out mixed, which led to a slight decline in the euro during the first half of the day. Producer prices in May accelerated to +5.9% y/y, while retail sales were more restrained.

Next, key US events are ahead: the ISM services index and the composite PMI index will be released, followed by attention shifting to a speech by FOMC member Christopher Waller. PMI and ISM are business activity indices calculated based on company surveys regarding new orders, employment, and prices. The 50-point level serves as the boundary between expansion and contraction, and the market typically prices in reactions based on how much the actual data deviates from expectations. The composite PMI combines manufacturing and services, providing a more complete picture of the economy, which is why its deviations often trigger noticeable movements in the currency market. For the euro, the setup is straightforward: stronger-than-forecast data will support the dollar and put pressure on EUR/USD, while disappointing data will support the single currency. Waller deserves special attention — as a member of the FOMC, he influences interest rate decisions, and any hint about the timing of future changes can significantly move the pair. The more hawkish the tone of his speech, the stronger the case for the dollar and the more vulnerable the euro appears in the short term.

Regarding the intraday strategy, I will rely more on scenarios #1 and #2.

Buy signal

Scenario #1: Today, buying the euro is possible when the price reaches the 1.1428 level (green line on the chart) with a target of growth toward 1.1455. At 1.1455, I plan to exit the market and also open short positions in the opposite direction, expecting a 30–35 point move from the entry point. A rise in the euro today is only possible after weak data. Important: before buying, make sure the MACD indicator is above the zero line and has just started rising from it.

Scenario #2: I also plan to buy the euro if there are two consecutive tests of the 1.1411 level at a time when the MACD indicator is in oversold territory. This would limit the downward potential and lead to a reversal upward. A move toward the opposite levels of 1.1428 and 1.1455 can be expected.

Sell signal

Scenario #1: I plan to sell the euro after reaching the 1.1411 level (red line on the chart). The target is 1.1388, where I plan to exit the market and immediately buy in the opposite direction (expecting a 20–25 point move back from the level). Pressure on the pair will return if the data is strong. Important: before selling, make sure the MACD indicator is below the zero line and has just started moving downward.

Scenario #2: I also plan to sell the euro if there are two consecutive tests of the 1.1428 level at a time when the MACD indicator is in overbought territory. This would limit upward potential and lead to a reversal downward. A decline toward the opposite levels of 1.1411 and 1.1388 can be expected.

What is shown on the chart:

• Thin green line – entry price at which the instrument can be bought;
• Thick green line – projected price level where take profit can be placed or profits manually locked in, as further growth above this level is unlikely;
• Thin red line – entry price at which the instrument can be sold;
• Thick red line – projected price level where take profit can be placed or profits manually locked in, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to follow overbought and oversold zones.

Important: beginner Forex traders should be very cautious when making market entry decisions. Before major fundamental reports are released, it is best to stay out of the market to avoid sharp volatility. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop orders, 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, similar to the one presented above. Spontaneous trading decisions based on current market conditions are, from the outset, a losing strategy for intraday traders.