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20.10.202604:26 Forex Analysis & Reviews: How to Trade The EUR/USD Currency Pair on October 20? Simple Tips and Trade Analysis for Beginners

Relevancia 01:00 2026-10-21 UTC+00

Review of Monday's trades:

1H chart of the EUR/USD pair

Exchange Rates 20.10.2026 analysis

EUR/USD showed no meaningful moves on Monday, as expected. At the open, price dropped sharply, then recovered just as sharply, and that was essentially the extent of the action. Note that by day's end the euro had only retraced a few dozen pips — market noise rather than a genuine reaction to events in France. Mass unrest and riots are, of course, negative, but protests occur regularly in many countries, including the US. That alone isn't enough for a currency to lose hundreds of pips. As for broader budget and debt concerns across the eurozone, the US faces similar fiscal strains—and with presidential elections in two weeks, political outcomes remain uncertain there as well.

5M chart of the EUR/USD pair

Exchange Rates 20.10.2026 analysis

On the 5-minute timeframe, Monday produced just one trading signal while price traded mostly sideways. During the European session, the pair closed above the 1.1198–1.1218 area, offering opportunities for entering long positions. By the end of the day, price had neither extended higher nor invalidated the buy signal, so that setup may still be in play today.

How to trade on Tuesday:

On the hourly timeframe, EUR/USD still reflects a downtrend that has been a full trend, but there are grounds to think that trend may be over. Over the past few months, we do not believe the euro should have collapsed like a stone for an entire month. The dollar now looks heavily overbought, and many euro-positive factors have been ignored.

On Tuesday, novice traders may consider short positions if price closes below the 1.1198–1.1218 area, targeting 1.1132–1.1140. Open long positions on a rebound from the 1.1198–1.1218 area, targeting 1.1267–1.1275.

On the 5-minute timeframe watch these levels: 1.1011, 1.1088, 1.1132–1.1140, 1.1198–1.1218, 1.1267–1.1275, 1.1366–1.1377, 1.1461–1.1474, 1.1527–1.1531, 1.1584–1.1594, 1.1655–1.1665. On Tuesday, the eurozone will publish economic-sentiment indices, and the US will release housing starts and building permits. We regard these releases as secondary and do not expect strong market reactions.

Key Rules of the Trading System:

  1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The less time taken, the stronger the signal.
  2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
  3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
  4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
  5. If two levels are too close together (within 5-20 pips), treat them as a support or resistance area.
  6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance serve as targets for opening buy or sell trades or as sources of signals.

Red lines indicate channels or trend lines that show the current trend and the preferred trading direction.

The MACD indicator (14,22,3) — the histogram and signal line — is an auxiliary indicator that can also provide signals.

Important speeches and reports (listed in the news calendar) can significantly influence currency pair movements. Therefore, during their release, traders should approach trading with utmost caution, or exit the market to avoid sudden reversals against the preceding move.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Paolo Greco,
Analytical expert of InstaSpot
© 2007-2026
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