Trade Breakdown and Tips for Trading the Euro

The price test at 1.0803 occurred when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. For this reason, I did not buy the euro. Shortly afterward, another test of the 1.0803 level occurred while MACD was in overbought territory, which allowed for the execution of Scenario #2 for selling, resulting in only a 15-point drop in the pair.

Due to insufficient statistical data from the eurozone, the observed buying activity near yesterday's low kept trading within the range suggested earlier in the day. However, the second half of the day promises to be much more eventful, as we await ADP employment data from the U.S., which often serves as a leading indicator for broader labor market reports. Analysts closely examine this release to assess the current employment landscape and its potential impact on the Federal Reserve's future policy decisions. Additionally, U.S. factory orders will also be reported. An increase in factory orders typically supports the U.S. dollar. FOMC member Adriana D. Kugler is also scheduled to speak today, but her remarks will likely be overshadowed by Trump's upcoming statements on tariffs, the details of which remain unknown.

As for the intraday strategy, I will continue to rely primarily on Scenarios #1 and #2.

Buy Signal

Scenario #1: Buy the euro today upon reaching the entry point near 1.0815 (green line on the chart), with the goal of rising toward 1.0858. Around 1.0858, I plan to exit long positions and consider shorting the euro in the opposite direction, targeting a 30–35 point correction. A bullish outlook today is only justified if U.S. data comes in weak and Fed officials issue dovish statements. Important! Before buying, ensure that the MACD indicator is above the zero line and just beginning to rise from it.

Scenario #2: I also plan to buy the euro today in the event of two consecutive tests of the 1.0788 level, while the MACD indicator is in oversold territory. This will limit the downward potential and could trigger a reversal to the upside. Growth toward the opposite levels of 1.0815 and 1.0858 can be expected.

Sell Signal

Scenario #1: I plan to sell the euro after a breakout below 1.0788 (red line on the chart). The target will be 1.0740, where I intend to exit short positions and open immediate long positions in the opposite direction, expecting a 20–25 point retracement. Selling pressure may return if Trump announces aggressive new tariffs. Important! Before selling, ensure the MACD indicator is below the zero line and just starting to decline from it.

Scenario #2: I also plan to sell the euro today in the event of two consecutive tests of the 1.0815 level, while the MACD indicator is in overbought territory. This will limit the pair's upward potential and may lead to a reversal to the downside. A decline toward the opposite levels of 1.0788 and 1.0740 is likely.

Chart Explanation:

• Thin green line – Entry price for buying the trading instrument;
• Thick green line – Approximate price for setting Take Profit or manually fixing profits, as further growth above this level is unlikely;Thin red line – Entry price for selling the trading instrument;
• Thick red line – Approximate price for setting Take Profit or manually fixing profits, as further decline below this level is unlikely;
• MACD Indicator – When entering the market, pay attention to overbought and oversold zones.

Important Note:

Beginner Forex traders should make entry decisions with great caution. It is best to stay out of the market before the release of important fundamental reports to avoid sudden price swings. If you choose to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you could quickly lose your entire deposit—especially if you neglect money management and trade with large volumes.

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