Trade Review and Recommendations for Trading the European Currency

The price test of 1.1585 occurred at a time when the MACD indicator had already risen significantly above the zero mark, which limited the pair's upward potential. For that reason, I did not buy the euro. The second test of this price shortly thereafter coincided with the MACD being in the overbought zone, which allowed Scenario No. 2 (selling the euro) to play out. As a result, the pair fell by 20 points.

Germany's Consumer Price Index (CPI) for October matched economists' forecasts. Although the October data met expectations, they still signal slight inflationary pressure in Europe's largest economy. The market's lack of a strong reaction to the CPI release can be explained by several factors. First, traders had already priced these figures into their forecasts and strategies. Second, market participants are waiting for further actions from the ECB and are paying closer attention to policymakers' comments.

Later today, the key event will be speeches by FOMC members John Williams, Christopher Waller, and Raphael Bostic. Market participants will carefully monitor their remarks for any hints about the future course of the Federal Reserve's monetary policy. These speeches from senior FOMC officials will provide insight into the committee's general consensus and reveal any potential disagreements. The market will focus on their assessment of the current economic situation, views on inflation, and preferred policy directions going forward. It should be remembered that even minor shifts in their rhetoric can cause noticeable fluctuations in the currency markets. Special attention will be paid to any indications of a possible further rate cut.

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

Buy Signal

Scenario No. 1: Today, I plan to buy the euro when the price reaches around 1.1580 (green line on the chart), aiming for growth toward 1.1611. At 1.1611, I plan to exit the market and open a short position in the opposite direction, expecting a movement of 30–35 points from the entry point. Euro growth today will only be possible if the Fed representatives adopt a dovish tone.Important! Before buying, make sure the MACD indicator is above the zero line and just beginning to rise from it.

Scenario No. 2: I also plan to buy the euro in the event of two consecutive tests of the 1.1564 price level when the MACD is in the oversold zone. This will limit the pair's downward potential and lead to a reversal upward. Growth toward 1.1580 and 1.1611 can then be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after the price reaches 1.1564 (red line on the chart). The target will be 1.1538, where I plan to exit the market and buy immediately in the opposite direction, expecting a 20–25 point rebound. Pressure on the pair may return if Fed representatives maintain a hawkish stance.Important! Before selling, make sure the MACD indicator is below the zero line and just beginning to decline from it.

Scenario No. 2: I also plan to sell the euro in the event of two consecutive tests of the 1.1580 price level when the MACD is in the overbought zone. This will limit the pair's upward potential and lead to a downward reversal. A decline toward 1.1564 and 1.1538 can then be expected.

Chart Key:

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

Important Notice for Beginner Forex Traders

New traders should exercise extreme caution when entering the market. It is best to stay out of the market before major fundamental reports are released to avoid sudden price swings. If you decide to trade during news events, always set stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit — especially if you trade large volumes without proper money management.

And remember: to trade successfully, you must have a clear trading plan, like the one outlined above. Spontaneous trading decisions based on the current market situation are an inherently losing strategy for intraday traders.