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The price test at 1.1537 occurred when the MACD indicator had moved significantly above the zero mark, confirming the limited upside potential for the pair. For this reason, I did not buy the euro.
Friday's statements from US Federal Reserve representatives, hinting at a possible policy tightening soon, contributed to the strengthening of the US dollar against the euro. High inflation and prospects for further price pressures—especially in the energy sector—are already impacting the Fed's plans, which only stimulate demand for safe-haven assets, including the US dollar.
Today, investors' attention will be focused on the March consumer price index (CPI) for Germany. This release will be the first following the escalation of the conflict between the US and Iran. The geopolitical tensions in the Middle East triggered by recent events may further undermine the euro's strength, benefiting the dollar. Today's inflation data could serve as a catalyst for further declines in the euro. In the event of unexpectedly high figures, the euro may slightly strengthen, but it is unlikely to have a significant impact on the bearish market.
Regarding the intraday strategy, I will primarily rely on implementing Scenarios #1 and #2.
Scenario #1: I plan to buy euros today when the price reaches around 1.1526 (green line on the chart), targeting a move towards 1.1571. At around 1.1571, I intend to exit my long positions and sell back in the opposite direction, aiming for a movement of 30-35 pips from the entry point. One can only expect the euro to rise after very good data. Important! Before buying, ensure the MACD indicator is above the zero mark and just starting an upward move from it.
Scenario #2: I also plan to buy euros today if the price tests 1.1507 twice in a row while the MACD indicator is in the oversold area. This will limit the downside potential of the pair and lead to an upward market reversal. One can expect growth towards the opposite levels of 1.1526 and 1.1571.
Scenario #1: I plan to sell euros after reaching 1.1507 (red line on the chart), targeting a drop to 1.1470. Near 1.1470, I will exit my short positions and immediately buy back in the opposite direction (aiming for movement of 20-25 pips in the opposite direction from the level). Pressure on the pair could return at any moment today. Important! Before selling, ensure the MACD indicator is below the zero mark and just starting its downward move.
Scenario #2: I also plan to sell euros today if the price tests 1.1526 twice in a row while the MACD indicator is in the overbought area. This will limit the upside potential of the pair and lead to a market reversal downwards. One can expect a decline towards the opposite levels of 1.1507 and 1.1470.
Important: Beginner traders in the forex market need to make entry decisions very carefully. It is best to stay out of the market before the release of important fundamental reports to avoid sharp fluctuations in prices. If you choose to trade during the release of news, always set Stop Loss orders to minimize losses. Without placing Stop Loss orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember, successful trading requires a clear trading plan, like the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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