Trade Review and Trading Advice for the European Currency

The test of the 1.1850 price level occurred when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. For this reason, I did not sell the euro. The second test of 1.1850 coincided with the MACD being in overbought territory, which allowed Scenario No. 2 for buying the euro to be implemented, continuing the development of the bullish market. As a result, the pair rose by 17 points.

The IFO business climate and expectations data from Germany came in below economists' forecasts, which negatively affected the euro. This unexpected development highlights the fragility of the current economic recovery and the European currency's dependence on macroeconomic indicators. Nevertheless, the euro showed a degree of resilience, failing to collapse under the pressure of negative news, which indicates continued confidence in the fundamental strengths of the European economy.

In the second half of the day, market participants' attention will focus on U.S. durable goods orders data. Growth in durable goods orders usually signals an increase in investment activity and consumer confidence, which is positive for the economy and, as a result, may strengthen the dollar. Investors and traders will pay attention not only to the headline figure but also to its components, including orders excluding transportation equipment, which provide a clearer picture of domestic demand. Forecasts for this indicator will be compared with the actual data, and any discrepancy between expectations and reality may cause significant currency volatility. Most likely, readings above forecasts will support the U.S. dollar, while weaker-than-expected results will put pressure on it.

As for the intraday strategy, I will mainly rely on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1:

Today, buying the euro is possible when the price reaches the 1.1865 level (green line on the chart), with a target of 1.1892. At 1.1892, I plan to exit the market and also sell the euro in the opposite direction, aiming for a 30–35 pint move from the entry point. A strong rise in the euro can be expected only after weak economic data.Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario No. 2:

I also plan to buy the euro today if there are two consecutive tests of the 1.1842 level while the MACD indicator is in oversold territory. This would limit the pair's downward potential and lead to a bullish market reversal. Growth toward the opposite levels of 1.1865 and 1.1892 can be expected.

Sell Signal

Scenario No. 1:

I plan to sell the euro after the price reaches 1.1842 (red line on the chart). The target will be 1.1817, where I intend to exit the market and immediately open a buy position in the opposite direction, aiming for a 20–25 point move upward from that level. Pressure on the pair will return following strong economic data.Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to move lower from it.

Scenario No. 2:

I also plan to sell the euro today if there are two consecutive tests of the 1.1865 level while the MACD indicator is in overbought territory. This would limit the pair's upward potential and lead to a bearish market reversal. A decline toward the opposite levels of 1.1842 and 1.1817 can be expected.

Chart Explanation:

• Thin green line – entry price for buying the trading instrument
• Thick green line – projected price where Take Profit orders can be placed or profits can be manually secured, as further growth above this level is unlikely
• Thin red line – entry price for selling the trading instrument
• Thick red line – projected price where Take Profit orders can be placed or profits can be manually secured, as further decline below this level is unlikely
• MACD indicator – when entering the market, it is important to use overbought and oversold zones as guidance

Important Note for Beginner Traders:

Beginner Forex traders must make entry decisions very cautiously. Before major 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 place stop-loss orders to minimize losses. Without stop-loss orders, you can very 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, like the one presented above. Spontaneous trading decisions based solely on current market conditions are an inherently losing strategy for intraday traders.