Review of Trades and Trading Tips for the Euro

The test of the 1.1196 level occurred when the MACD indicator was just beginning to move upward from the zero line, confirming a favorable entry point for buying the euro. As a result, the pair rose by only 5 points.

Yesterday's US economic data were strong but failed to support the dollar. The number of job openings remained at 7.5 million in September, hiring totaled 5.4 million, and voluntary quits increased to 3.4 million. US factory orders rose by 1.8% in September, compared with a forecast of 1.2%, further confirming the strength of the US economy. Such figures usually support expectations for Federal Reserve interest rates and strengthen the dollar. However, this time, the US currency remained under pressure, allowing the euro to benefit. Other factors were responsible for this reaction. The results of the congressional elections changed the balance of power in Washington, as the Democrats secured majorities in both the House of Representatives and the Senate. The new Congress will convene in early January. Geopolitical risks surrounding Iran are also contributing to uncertainty, preventing the market from establishing a clear direction.

Today, the first half of the trading day is expected to be eventful, with several important eurozone releases scheduled. First, the market will receive the final figures for services sector business activity and the Composite PMI. Forecasts suggest that both readings will remain in line with the preliminary October estimates of 51.7 and 51.9, respectively. However, it is important to consider the previous figures. In September, the Services PMI stood at 53.0, while the Composite PMI came in at 53.1. This means that the preliminary October data had already indicated a notable slowdown, the sharpest in several months. Therefore, readings above expectations would suggest that the slowdown has been less pronounced than traders anticipated, which would typically support the single currency.

Inflation data will follow. The headline Consumer Price Index for October is expected to accelerate to 4.0% from 3.8% in September, compared with 3.2% in August. This indicates that price growth has continued for several consecutive months. September's reading of 3.8% marked the highest level since September 2023, mainly due to higher energy prices. The core index is expected to remain at 2.5%, following 2.4% in August. This indicator will help determine whether inflationary pressure is spreading to other components of the consumer basket. If both inflation and business activity exceed forecasts, expectations of a tighter ECB monetary policy will strengthen, providing additional support for the euro. Against this backdrop, the weakening of the US dollar following the US election results creates favorable conditions for euro buyers. If the data exceed expectations, EUR/USD is likely to extend its gains. If the figures match forecasts, the upward movement will most likely lose momentum.

Regarding the intraday strategy, the main focus will be on implementing Scenarios #1 and #2.

Buy Signals

Scenario #1: Today, the euro can be bought when the price reaches the 1.1241 level (the green line on the chart), with a target of 1.1292. At 1.1292, the plan is to close the position and also open a short position on the euro, targeting a move of 30–35 points from the entry point. Further gains in the euro today can only be expected if the economic data are positive. Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.

Scenario #2: The euro can also be bought today if the price tests the 1.1224 level twice consecutively while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and trigger an upward market reversal. A rise toward the opposite levels of 1.1241 and 1.1292 can then be expected.

Sell Signals

Scenario #1: The euro will be sold after the price reaches the 1.1224 level (the red line on the chart). The target will be 1.1191, where the plan is to close the short position and immediately open a long position, targeting a rebound of 20–25 points from that level. Downward pressure on the pair is likely to return if the economic data are weak. Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.

Scenario #2: The euro can also be sold today if the price tests the 1.1241 level twice consecutively while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and trigger a downward market reversal. A decline toward the opposite levels of 1.1224 and 1.1191 can then be expected.

What the Chart Shows

• Thin green line – the entry price at which the trading instrument can be bought.
• Thick green line – the projected price level at which Take Profit orders can be placed or profits can be closed manually, as further gains above this level are considered unlikely.
• Thin red line – the entry price at which the trading instrument can be sold.
• Thick red line – the projected price level at which Take Profit orders can be placed or profits can be closed manually, as further declines below this level are considered unlikely.
• MACD indicator – when entering the market, it is important to consider the overbought and oversold zones.

Important. Beginner Forex traders should exercise extreme caution when making market entry decisions. Before the release of important fundamental reports, it is generally best to stay out of the market to avoid exposure to sharp exchange rate fluctuations. If trading during news releases, always use stop-loss orders to minimize potential losses. Without stop-loss orders, the entire trading account can be lost very quickly, especially when position sizes are large and proper money management is not applied.

Remember that successful trading requires a clear trading plan, such as the one outlined above. Making spontaneous trading decisions based on current market conditions is fundamentally a losing strategy for an intraday trader.