23.01.202609:00 Forex Analysis & Reviews: EUR/USD: Simple Trading Tips for Beginner Traders on January 23. Analysis of Yesterday's Forex Trades

Trade Analysis and Tips for Trading the Euro

The test of the price at 1.1709 occurred when the MACD indicator had moved significantly above the zero mark, which limited the pair's upward potential. For this reason, I did not buy the euro. The second test of 1.1709 allowed for the implementation of Scenario #2 to sell the euro, but the pair did not fall as expected.

This morning, comprehensive information on the PMIs for the manufacturing and services sectors, and the composite PMI for the Eurozone, will be published. Additionally, a speech by the President of the European Central Bank, Christine Lagarde, is scheduled. The PMI indicators are important indicators of the Eurozone's economic health. Special attention will be paid to the composite PMI, reflecting the overall situation in the business sector. If the actual values exceed forecasts, it may indicate sustained growth and, consequently, support the euro. Conversely, if the figures fall short of expectations, pressure on the euro may increase.

Christine Lagarde's speech will be the key moment of the day. Market participants will closely monitor her statements regarding forecasts for the Eurozone economy, inflation, and the ECB's future monetary policy. Any signal of a change in monetary policy, especially a tightening, could lead to a sudden strengthening of the euro. If Lagarde expresses concerns about slowing economic development or insufficient inflation, this could lead to a decline in the euro exchange rate.

In the context of geopolitical instability and unpredictable markets, today's economic data and ECB statements will be of exceptional importance in shaping short-term prospects for the Eurozone.

As for intraday strategies, I will rely more on implementing Scenarios #1 and #2.

Buy Scenarios

Scenario #1: Today, I can buy the euro at a price near 1.1756 (green line on the chart), with a target for growth to 1.1778. At the point of 1.1778, I plan to exit the market and also sell the euro in the opposite direction, aiming for a movement of 30-35 pips from the entry point. Growth in the euro can only be expected after good data. Important! Before buying, ensure the MACD indicator is above the zero line and just starting to rise.

Scenario #2: I also plan to buy the euro today in the event of two consecutive tests of the price at 1.1741 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upwards. An increase can be expected towards the opposing levels of 1.1756 and 1.1778.

Sell Scenarios

Scenario #1: I plan to sell the euro once it reaches 1.1741 (red line on the chart). The target will be the level of 1.1722, where I intend to exit the market and immediately buy in the opposite direction (aiming for a movement of 20-25 pips in the opposite direction from the level). Pressure on the pair may return today with weak data. Important! Before selling, ensure the MACD indicator is below the zero line and just starting its decline.

Scenario #2: I also plan to sell the euro today if the price tests 1.1756 twice in a row while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. A decline can be expected to the opposing levels of 1.1741 and 1.1722.

What is on the chart

• Thin green line — entry price at which you can buy the instrument
• Thick green line — suggested Take Profit price or level at which to manually lock in profit, since further rise above this level is unlikely.
• Thin red line — entry price at which you can sell the instrument
• Thick red line — suggested Take Profit price or level at which to manually lock in profit, since further decline below this level is unlikely.
• MACD indicator — when entering the market, it is important to follow the overbought and oversold zones
• Important notes: Beginner forex traders must be very cautious when deciding to enter the market. It is best to be out of the market before major fundamental reports are released to avoid being caught in sharp price swings. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit quickly, especially if you do not use money management and trade large volumes.
• Remember that successful trading requires a clear trading plan like the one presented above. Spontaneous trading decisions based on current market noise are a losing strategy for the intraday trader.