Trade Analysis and Tips for the Euro Currency

The price test at 1.1704 coincided with the MACD indicator moving significantly below the zero mark, which limited the pair's downward potential.

The acceleration of inflation in the US, fueled by geopolitical upheavals in the Middle East, particularly the conflict in Iran, has heightened concern in financial markets, strengthening the dollar and weakening the euro. Market participants have become much more cautious about the prospects for US monetary policy easing. Now, the likelihood that the Federal Reserve will have to maintain high interest rates for a longer period has significantly increased. Moreover, the scenario of further monetary tightening is not ruled out if inflationary pressures continue to accelerate, overshadowing any signs of a possible slowdown.

Today, the first half of the day will be marked by the release of important macroeconomic data from Italy—the Consumer Price Index (CPI). This indicator is a key measure of inflationary processes in the country, reflecting changes in prices for goods and services consumed by households. Data on Italy's CPI may provide insights into current inflationary pressures and influence expectations of the Bank of Italy's monetary policy. Investors will closely analyze both the overall CPI and its components to identify potential trends and risks.

Simultaneously with the Italian data, the European Central Bank economic bulletin is expected to be published. The ECB's economic bulletin is an important source of information for market participants as it contains the central bank's official assessment and can serve as a guideline for future decisions. Particular attention will be paid to any references to potential changes in interest rates and inflation, as well as to assessments of the impact of external factors, such as geopolitical tensions, on the eurozone economy.

As for the intraday strategy, I will focus more on implementing Scenarios #1 and #2.

Buying Scenarios

Scenario #1: Today, I can buy euros if the price reaches the area around 1.1656 (green line on the chart), with a target for growth to 1.1685. At 1.1685, I plan to exit the market and sell euros back, anticipating a move of 30-35 pips from the entry point. Growth in the euro can only be expected after strong eurozone data. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario #2: I also plan to buy euros today if there are two consecutive tests of 1.1631 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. An increase can be expected at the opposite levels of 1.1656 and 1.1685.

Selling Scenarios

Scenario #1: I plan to sell euros once the price reaches 1.1631 (red line on the chart). The target will be 1.1594, where I intend to exit the market and buy back immediately in the opposite direction (anticipating a move of 20-25 pips in the opposite direction from the level). Pressure on the pair may return at any moment today. Important! Before selling, ensure the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario #2: I also plan to sell euros today if there are two consecutive tests of 1.1656 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. A decline can be expected to the opposite levels of 1.1631 and 1.1594.

What is on the Chart:

• The thin green line – entry price at which the trading instrument can be bought;
• The thick green line – approximate price where take profit can be set or to realize profit, as further growth above this level is unlikely;
• The thin red line – entry price at which the trading instrument can be sold;
• The thick red line – approximate price where take profit can be set or to realize profit, 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 traders in the Forex market need to make entry decisions very cautiously. It is best to stay out of the market before important fundamental reports 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 use money management and trade in large volumes.

And remember, for successful trading, it is essential to have a clear trading plan, as outlined above. Making impulsive trading decisions based on the current market situation is fundamentally a losing strategy for an intraday trader.