Trade review and tips for trading the euro

The test of 1.1702 coincided with the moment when the MACD indicator had just started moving down from the zero line, confirming the correct entry point for selling the euro. As a result, the pair fell by only 7 points, after which sellers exited.

Italian industrial data exceeded expectations, which helped euro buyers withstand the pressure seen during the first half of trading. This favorable signal from Italy somewhat eased concerns about the overall situation in the country's industrial sector. However, fluctuations in energy prices, inflation—slowing but still significant—and the geopolitical backdrop continue to influence the euro area. The improvement in Italy's manufacturing sector is a positive sign, but it is not enough for a fundamental turnaround. In the near future, market attention will be focused on European Central Bank statements and new macroeconomic reports.

In the second half of the day, U.S. statistics will be released on the Producer Price Index (PPI) for August, as well as wholesale inventory data. These figures will be a crucial barometer of inflationary pressure in the U.S. economy and will influence future Federal Reserve monetary policy decisions. Of particular importance is the core PPI, which excludes volatile components such as food and energy. Its dynamics will provide a clearer view of inflation persistence and its impact on consumer prices. Changes in wholesale inventories, in turn, will indicate the balance of supply and demand across different markets. An increase in inventories may point to slower economic growth, while a decrease suggests rising consumer activity.

The published data will immediately impact the U.S. dollar. Positive results showing lower inflation and stronger growth may support the dollar. Negative results, on the contrary, may weaken it.

As for intraday strategy, I will rely more on scenarios No. 1 and No. 2.

Buy signal

Scenario No. 1: Today, buying the euro is possible around 1.1718 (green line on the chart) with the target of rising to 1.1766. At 1.1766, I plan to exit the market and also sell the euro in the opposite direction, aiming for a 30–35 point move from the entry point. A rise in the euro can only be expected in case of a sharp drop in U.S. inflation.Important! Before buying, make sure that the MACD indicator is above the zero line and has just started to rise from it.

Scenario No. 2: I also plan to buy the euro if the price of 1.1695 is tested twice in a row, at a time when the MACD indicator is in oversold territory. This will limit the downward potential of the pair and lead to a market reversal upward. Growth toward the opposite levels of 1.1718 and 1.1766 can then be expected.

Sell signal

Scenario No. 1: I plan to sell the euro after the price reaches 1.1695 (red line on the chart). The target will be 1.1655, where I plan to exit the market and buy immediately in the opposite direction (expecting a 20–25 point move in the opposite direction). Pressure on the pair will return today if news emerges of a sharp rise in U.S. inflation.Important! Before selling, make sure that the MACD indicator is below the zero line and has just started to decline from it.

Scenario No. 2: I also plan to sell the euro if the price of 1.1718 is tested twice in a row, at a time when the MACD indicator is in overbought territory. This will limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 1.1695 and 1.1655 can then be expected.

What's on the chart:

• Thin green line – entry price for buying the instrument;
• Thick green line – estimated level to place Take Profit or lock in profit manually, as further growth above this level is unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – estimated level to place Take Profit or lock in profit manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to consider overbought and oversold areas.

Important. Beginner Forex traders must be very cautious when making entry decisions. Before major fundamental reports are released, it is best to stay out of the market to avoid sudden price swings. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you don't use money management and trade large volumes.

And remember: for successful trading you must have a clear trading plan, like the one presented above. Spontaneous trading decisions based only on the current market situation are a losing strategy for an intraday trader from the start.