On Thursday, EUR/USD has got trapped on a range-bound market for the whole day. It has been trading inside a 40-pips range. Despite the publication of important macroeconomic data on the US economy, this did not trigger any price gyrations. As for economic metrics published, all data was rather neutral. The second estimate of US GDP data for Q1 2021 coincided with the first estimate. Other reports did not arouse avid interest among market participants. Nevertheless, MACD indicator generated long-awaited buy signals, though both were false. In practice, sensible traders were able to combine these signals with signals from a 5-minute chart that enabled them not only to avoid losses but also earned some gains. Basically, there is nothing to discuss about MACD signals. The indicator reversed upwards twice. Both times the price greatly undershot the nearest target. Moreover, the price moved too little. Let's look at the signals from a chart with a junior timeframe.
Well, let's figure out a 5-minute chart. Today, two buy signals have been formed in this chart. In fact, they appeared a bit earlier than the signals by MACD on a 30-minute chart. So, the buy signals from a 5-minute chart should have been worked out first. Both signals were bounced off 1.2181. In the first case, a bounce was perfect, thus suggesting the opportunity to long positions. After the signals had been formed, the price moved upwards by nearly 20 pips. The same happened in the second case: a clear signal and a bounce of almost 20 pips. Hence, in both cases beginners had the opportunity to place stop orders at breakeven. So, there didn't make losses on these two trades. They could have gained profit from these two trades on condition of manual closing. The second trade could have been closed manually when it became clear that volatility was low.
Therefore, EUR/USD could have yielded 10-20-pips profit, although it is complicated to trade in the flat market. I mean, it doesn't make bring good profits.
How to trade EUR/USD on Friday
A 3-minute chart is still showing a clear-cut bullish trend. So, it is recommended to consider long positions. However, the pair was trading flat for the whole day. Therefore, MACD indicator can generate fake signals. Tomorrow, I would advise beginners to carry on monitoring buy signals. Importantly, if the pair has been firmly stuck in a range, please don't take notice of MACD signals.
In a 5-minute chart, it is recommended to trade from the following levels: 1.2159, 1.2181, 1.2215, and 1.2266. As always, take profit has to be placed 30-40 pips away. Stop loss would close your trade at breakeven if the price moves in the expected direction 15-20 pips. In a 5-minute chart, a target could be any nearest level which is not too close or not too far away.
When it comes to the economic calendar on Friday, no events are scheduled in the EU. The US will release a few reports of secondary importance. All in all, macroeconomic data will hardly make any impact on EUR/USD. Let me warn you that it doesn't mean that the flat market is over.
