Trade review and tips for trading the European currency

The test of 1.1230 came when the MACD indicator had moved far above the zero mark, limiting the pair's upside potential. For that reason, I did not buy the euro. A second test of 1.1230 triggered Scenario No. 2 for selling, with the pair falling 15 pips.

With no important U.S. data and under pressure from worrying news from the Middle East, EUR/USD traded the day in a narrow sideways channel without losing chances for a rise. While traders waited for another impulse, the newsfeed produced several worrying signals. According to Iranian journalists, aircraft are being evacuated from Al-Udeid airbase in Qatar. At the same time, reports say U.S. military and diplomats are secretly leaving the region. Tehran, in turn, is preparing for an attack by the U.S. and Israel and does not trust Washington's diplomatic gestures. Such headlines usually play into the dollar's hands as a safe-haven currency, which makes it all the more interesting that the pair still holds near the top of the range and has not collapsed. This shows euro buyers have not yet surrendered. I think further growth is possible if the news stays in words, but a serious escalation would give the dollar a chance to recover its losses quickly.

The European calendar is thin today, with only the consumer-confidence indicator as a notable item. It is expected at -17.0 points versus -16.5 a month ago. Even if the figure comes in noticeably better or worse than expected, it is unlikely to overturn the market, and traders will likely ignore it. Therefore, the day's main protagonists will be U.S. Treasury yields and news from the Middle East. The former directly affects the dollar's appeal, and the latter set the overall tone of caution or, conversely, optimism. The euro is more of a spectator here, and EUR/USD will react to external narratives. In my view, while Europe remains quiet, US yields and geopolitics will point to direction, and consumer confidence will only slightly tweak sentiment.

For the intraday strategy, I will rely more on Scenarios No. 1 and No. 2.

Scenarios for Buying

Scenario No. 1: Today, it is possible to buy the euro when it reaches around 1.1253 (green line on the chart), targeting a rise to 1.1280. At 1.1280, I plan to exit the market and sell the euro in the opposite direction, expecting a move of 30–35 pips from the entry point. One can count on the euro rising today only after good news on the Middle East. Important! Before buying, make sure the MACD indicator is above the zero mark and is only beginning to rise from it.

Scenario No. 2: I also intend to buy the euro today in the event of two consecutive tests of the price 1.1239 at a time when the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. One can expect a rise to the opposite levels of 1.1253 and 1.1280.

Scenarios for Selling

Scenario No. 1: I plan to sell the euro after it reaches 1.1239 (red line on the chart). The target is 1.1218, where I plan to exit the market and immediately buy in the opposite direction (expecting a 20–25 pip move away from the level). Strong pressure on the pair can return at any moment today. Important! Before selling, make sure the MACD indicator is below the zero mark and is only beginning to decline from it.

Scenario No. 2: I also intend to sell the euro today if the price tests 1.1253 twice while the MACD indicator is in the overbought area. This will limit the pair's upside potential and lead to a downward reversal. One can expect a decline to the opposite levels of 1.1239 and 1.1218.

What's on the chart:

Thin green line — entry price where you can buy the instrument.

Thick green line — approximate price where you can place Take Profit or manually lock in profits, because further upside above this level is unlikely.

Thin red line — entry price where you can sell the instrument.

Thick red line — approximate price where you can place Take Profit or manually lock in profits, because further downside below this level is unlikely.

MACD indicator. When entering the market, it's important to consider overbought and oversold zones.

Important. Novice Forex traders must be very cautious when deciding to enter the market. It is best to stay out before major fundamental reports to avoid getting 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 quickly lose your entire deposit, especially if you don't use money management and trade large volumes.

Remember: successful trading requires a clear trading plan, like the example above. Spontaneous trade decisions based solely on the immediate market situation are, by definition, a losing strategy for an intraday trader.