Review of Trades and Trading Tips for the Euro Currency

The price test at 1.1680 coincided with the moment when the MACD indicator had moved significantly downward from the zero mark, limiting the pair's downside potential. The second test at 1.1680 triggered the implementation of scenario No. 2 for buying, resulting in a slight increase of 10 pips.

Strong U.S. data set the tone for trading yesterday and ensured a rise for the dollar. The manufacturing index from the Philadelphia Fed jumped to 47.4 points from 41.4, and its employment component soared by 18 points to 27.9, marking a record high since April 2022. The index reflects sentiment in the region's industry. It is considered one of the early signals of business activity, so such a sharp increase convinced the market of the economy's resilience and played in favor of the American currency. Additional support for the dollar came from the labor market. Initial jobless claims fell to 206,000, and the number of recipients of benefits decreased to 1.799 million. Strong data increased the dollar's appeal and pushed the EUR/USD pair down.

Today, the euro enters the first half of the day amid a busy European agenda, with key items including the August PMI indices for manufacturing, services, and the composite index, as well as the Eurozone consumer confidence indicator. Business activity indices are leading indicators, as they are the first to capture changes in business sentiment, and the services sector is especially important, as it accounts for the largest share of the bloc's economy. Consumer confidence will add to the picture from the demand side. Much will depend on whether the data confirms the recent revival, as activity in the region was gaining momentum in July. Positive indicators could trigger a new wave of euro purchases, giving the EUR/USD pair upward momentum amid growing confidence in the economy's resilience.

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

Buying Scenarios

Scenario No. 1: Today, buying the euro can be considered upon reaching a price of around 1.1705 (green line on the chart), with a target for growth to 1.1739. At 1.1739, I plan to exit the market and also sell the euro in the opposite direction, expecting a move of 30-35 pips from the entry point. One can expect the euro to rise in continuation of the trend. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just starting to rise from it.

Scenario No. 2: I also plan to buy the euro today in the event of two consecutive tests of the price at 1.1687, when the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. One can expect growth to the opposite levels of 1.1705 and 1.1739.

Selling Scenarios

Scenario No. 1: I plan to sell the euro once it reaches 1.1687 (the red line on the chart). The target will be 1.1647, where I plan to exit the market and buy immediately in the opposite direction (expecting a 20-25-pip move back from the level). Pressure on the pair today will return if data is weak. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just starting to decline from it.

Scenario No. 2: I also plan to sell the euro today in the event of two consecutive tests of the price at 1.1705, when the MACD indicator is in the overbought area. This will limit the pair's upside potential and lead to a downward market reversal. One can expect a decline to the opposite levels of 1.1687 and 1.1647.

What the Chart Shows:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated price where take profit can be set, or profit can be realized, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated price where take profit can be set, or profit can be realized, as further decline below this level is unlikely;
• MACD Indicator. When entering the market, it is important to be guided by overbought and oversold zones.

Important: Beginner forex traders need to make entry decisions very cautiously. Before key fundamental reports are released, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not practice money management and trade large volumes.

And remember, successful trading requires a clear trading plan, as outlined above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.