Trade review and trading tips for the euro

The price test at 1.1616 occurred when the MACD indicator had moved far below the zero line, limiting the pair's downside potential, especially after the European Central Bank published new forecasts.

Yesterday the euro managed to hold up despite a powerful blow from the dollar. The US currency was boosted by the producer prices report, where inflation clearly accelerated: the annual figure reached 5.4% with core at 4.7%, and together with rising oil, this strengthened the market's belief in another Federal Reserve rate hike this year. Because producer prices foreshadow consumer inflation, their acceleration became a strong argument for the dollar, and it initially rallied confidently. The ECB's rhetoric helped reverse that mood. By raising rates, Christine Lagarde emphasized the main threat: expensive energy will gradually seep into core inflation and food prices, keeping the headline measure noticeably above target until at least the first half of 2027. In my view, this sounded quite hawkish, since the central bank effectively signaled it does not intend to stop at what has been achieved.

Today the euro enters the day practically without internal guides, since the only calendar item is Italy's quarterly unemployment data, which are marginal for the market. Such an indicator does little to determine direction for the single currency, and relying on it when searching for direction is pointless. It is much more logical that participants' attention has already shifted across the ocean, where the key US inflation report will be released during the American session. I believe expectations for that release will determine euro behavior in the first half of the day. Before such a significant publication, buyers are unlikely to scale up positions because the risk is too high and the data can move the dollar in either direction. I expect EUR/USD to trade in a sluggish range during the pre-US session, with real movement beginning only after the US inflation figures are out.

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

Buy scenarios

Scenario No. 1: Today, one can buy the euro if the price reaches around 1.1616 (green line on the chart), targeting a rise to 1.1638. At 1.1638, I plan to exit the market and sell the euro in the opposite direction, aiming for a 30–35 pip move from the entry point. Expect euro growth as part of the continuation of the bull market. Important: before buying, make sure the MACD indicator is above the zero line and only beginning to rise from it.

Scenario No. 2: I also plan to buy the euro today in case of two consecutive tests of 1.1603 while the MACD is in oversold territory. This will limit the pair's downside potential and lead to an upward reversal. One can expect moves to the opposite levels 1.1616 and 1.1638.

Sell scenarios

Scenario No. 1: I plan to sell the euro after it reaches 1.1603 (red line on the chart). The target will be 1.1578, where I plan to exit the market and immediately buy in the opposite direction (expecting a 20–25 pip reversal from that level). Pressure on the pair will return today if data is weak. Important: before selling, make sure the MACD indicator is below the zero line and only beginning to fall from it.

Scenario No. 2: I also plan to sell the euro today in case of two consecutive tests of 1.1616 while the MACD is in overbought territory. This will limit the pair's upside potential and trigger a downward reversal. Expect a decline to the opposite levels of 1.1603 and 1.1578.

What to Look for on the Chart:

• Thin Green Line – Entry price at which you can buy the trading instrument;
• Thick Green Line – Estimated price where you can set Take Profit or manually secure profits, as further growth above this level is unlikely;
• Thin Red Line – Entry price at which you can sell the trading instrument;
• Thick Red Line – Estimated price where you can set Take Profit or manually secure profits, as further decline below this level is unlikely;
• MACD Indicator. When entering the market, it's important to consider overbought and oversold zones.

Important: Beginner traders in the Forex market need to be very cautious when making entry decisions. It is best to stay out of the market ahead of significant fundamental reports to avoid being caught in sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you do not employ money management practices and trade large volumes.

Also, remember that successful trading requires a clear trading plan, similar to the one provided above. Making spontaneous trading decisions based on current market conditions is inherently a losing strategy for intraday traders.