Trade Review and Advice on Trading the European Currency

The test of the 1.1618 price level 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. A second test of 1.1618 led to the implementation of Sell Scenario No. 2, resulting in a 25-point decline in the pair.

According to IHS Markit data, the eurozone services PMI reached 51.9 points in February. This result indicates positive momentum in this sector, which is critical for the region's economy. In February, the indicator exceeded analysts' expectations of 50.9 points. The positive dynamics contributed to a partial recovery of the euro exchange rate after its recent sharp decline.

Next, investors will be closely watching February's ADP private-sector employment data from the United States. This statistic serves as an important barometer of the U.S. labor market and often precedes the release of broader unemployment reports. Job growth above forecasts could strengthen the dollar and weaken the euro's intraday bullish trend. Data on the ISM Services PMI are also expected. Positive figures from this sector, indicating expansion, could further support the U.S. dollar by demonstrating the resilience of the American economy amid global uncertainty.

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

Buy Signal

Scenario No. 1: Today, the euro can be bought when the price reaches the 1.1629 level (green line on the chart), with a target of 1.1692. At 1.1692, I plan to exit the market and also consider selling the euro in the opposite direction, aiming for a 30–35 point move from the entry point. A strong euro rise today can be expected after weak U.S. statistics.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 if there are two consecutive tests of the 1.1595 level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upward. Growth toward the opposite levels of 1.1629 and 1.1692 can then be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after it reaches the 1.1595 level (red line on the chart). The target will be 1.1540, where I intend to exit the market and immediately buy in the opposite direction (aiming for a 20–25 point move from that level). Pressure on the pair will return in the case of strong data.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 if there are two consecutive tests of the 1.1629 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels of 1.1595 and 1.1540 can then be expected.

Chart Explanation

• Thin green line – entry price for buying the trading instrument.
• Thick green line – projected level for placing Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line – entry price for selling the trading instrument.
• Thick red line – projected level for placing Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important

Beginner Forex traders should make market entry decisions very carefully. Before the release of important fundamental reports, 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 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 outlined above. Spontaneous trading decisions based solely on the current market situation are an inherently losing strategy for an intraday trader.