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The EUR/USD currency pair continued to decline on Tuesday, but the hourly chart shows the decline is weak and not impactful. The dollar received market support at the beginning of the week amid geopolitical tensions between Iran and the US, but it did not show significant growth. Recall that on Monday, it was reported that Donald Trump rejected the peace agreement proposed by Iran, and on Tuesday, the US President stated that the deal with Tehran is at risk of collapse. Once again, Trump's statements triggered market movements. However, how truthful these statements are remains an open question. Regardless, the dollar did not strengthen significantly because the geopolitical factor no longer affects traders as it did a month or two ago. The market understands that Trump's statements are significant, but they shouldn't be taken at face value 100%. Therefore, the reaction has been subdued, and the dollar cannot count on a new trend.
On the 5-minute timeframe, one sell signal was generated on Tuesday, and movements throughout the day were weak. During the American trading session, the price consolidated below the 1.1745-1.1754 area, but we did not see a significant decline. There were no losses on the trade, but it was also unlikely to achieve a profit.
On the hourly timeframe, the upward trend persists, but the euro is struggling to reverse. The rise of the US currency has halted, as the conflict in the Middle East is in a "quiet mode," but the European currency is also not in a hurry to rise, as negotiations are progressing very slowly, there is no official information, and both sides regularly violate the terms of the ceasefire.
On Wednesday, beginner traders may open short positions targeting the 1.1655-1.1666 area if the price bounces from the 1.1745-1.1754 area. New long positions can be considered if the price consolidates above the 1.1745-1.1754 area, targeting 1.1830-1.1837.
On the 5-minute timeframe, the levels to consider include 1.1354-1.1363, 1.1413, 1.1455-1.1474, 1.1527-1.1531, 1.1584-1.1591, 1.1655-1.1666, 1.1745-1.1754, 1.1830-1.1837, and 1.1899-1.1908. On Wednesday, industrial production and the second estimate of first-quarter GDP will be published in the EU, while the US will release the Producer Price Index. We consider all three reports to be secondary and do not expect a market response to them.
Price levels (areas) of support and resistance – levels that are targets when opening purchases or sales, or sources of signals.
Red lines – channels or trend lines that display the current trend and indicate which direction is preferable to trade now.
MACD indicator (14, 22, 3) – histogram and signal line – a supporting indicator that can also be used as a source of signals.
Important speeches and reports (contained in the news calendar) can significantly influence the movement of the currency pair. Therefore, during their release, trading should be done as cautiously as possible, or one should exit the market to avoid a sharp price reversal against the preceding movement.
Beginners trading in the Forex market should remember that not every trade can be profitable. Developing a clear strategy and effective money management are key to long-term trading success.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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