The EUR/USD pair, quite unexpectedly for many, started an upward movement on Thursday, which was practically recoilless within the day. By the end of the trading day, the price worked out the downtrend line that we talked about yesterday and rebounded from it. Thus, novice traders received a powerful sell signal, which is generated infrequently. We believe that in this situation it was possible to take a risk and open short positions. At the moment, you should set Stop Loss to breakeven. Usually, when price bounces off the trendline and the bounce is not false, it starts a strong move in the direction of the trendline. This was the case, for example, on the last rebound a couple of days ago. The trend remains downtrend and is now supported by the trend line. If the pair consolidates above it, then it will be possible to conclude that the downward movement is completed and a period of growth of the European currency begins. As for the macroeconomic background, not a single important report has been published today. In America, a report was released on applications for unemployment benefits, which did not interest anyone. In the European Union, the ECB presented a report on the change in the inflation targeting parameter within the framework of monetary policy. Now the ECB will allow inflation to stay slightly above 2%, which, however, does not significantly change the general state of affairs.
Several signals were formed on the 5-minute timeframe during the day, but not all of them were profitable and correct. Let's take a look at how you should have traded today and what came of it. The first signal of the day was very inaccurate. The price first rose to the level of 1.1807, bounced off it, consolidated below the level of 1.1800, returned to 1.1807 and eventually broke it. It was difficult for novice traders here, as it required a certain endurance and patience. However, as a result, the price still consolidated above both levels 1.1800 and 1.1807 (the first is no longer relevant and removed from the chart), which served as a signal to open long positions. Unfortunately, even this signal was very inaccurate. Nevertheless, the pair subsequently went up about 15 points, so it was necessary to place a Stop Loss order at breakeven and wait for Take Profit. The position should not have been closed near the nearest level of 1.1835, since at that time the trade was in profit only about 10 points. Subsequently, this level was overcome, as well as the level of 1.1851. In total, the pair went up by 30 and 40 points, so the deal had to be closed by Take Profit. There was no level 1.1868 today - this is the price high for today. Rejection of closing prices below 1.1851 should not have been, since by that time it was already evening.
Trading tips for Friday:
The downward trend persists and a downtrend line has finally formed on the 30-minute timeframe. However, the very nature of the movement due to this line did not change at all. It is still as uncertain and chaotic as possible. Thus, the signals of the MACD indicator can now be considered, but first you need to let it discharge to the zero level. We also remind you of an open short position on the rebound from the trend line. The 30-minute illustration shows that the pair continues to be in a 120-pip sideways channel. On a 5-minute timeframe, it is recommended to trade from the levels 1.1784, 1.1807, 1.1835, 1.1851, 1.1868. Take Profit, as before, is set at a distance of 30-40 points. Stop Loss - to breakeven when the price passes in the right direction by 15-20 points. At 5M TF, the target can be the nearest level if it is not too close or too far away. If located - then you should act according to the situation. On Friday, Christine Lagarde, ECB President, will deliver a speech in the European Union. Perhaps she will give the markets some important information, so at this time you need to be on the lookout.
