November 3, 2021

Trading plan for EUR/USD on November 3. Simple tips for beginners. Swing moves brought the pair back to a sideways channel

 On Tuesday, November 2, EUR/USD went 38 pips from the low to high which is characteristic behavior of this pair. In addition to low volatility that has become a frequent occurrence, the pair returned to a sideways channel where it had been stuck for several days before breaking out of it at the end of the last week. Today in late trades, EUR/USD was making attempts to breach the lower boundary of the channel, but the trend remained flat due to low volatility. Given the above factors, we still recommend ignoring the MACD signals. As for the macroeconomic statistics, the only event that was worth attention on Tuesday was the Services PMI from the eurozone. The index reading came in a bit lower than expected, so this report caused little reaction from market participants.

As seen on the 5M time frame, the movement was rather sluggish on Tuesday. Most of the time, the pair was fluctuating between 1.1585 and 1.1617, i.e. in a 30-pips channel. It even failed to break the channel's upper boundary. In addition to bad dynamics, there were almost no trading signals. Those signals that were formed turned out to be false. Unfortunately, it often happens in a flat trend. Let us remind you that the optimal place to set a Take Profit is 30 pips away from an opening price. Is there any chance that it will be triggered given that the pair moved by just 40 pips? But let us get back to the trading signals that were formed after all. The first one appeared during the European session - it was a buy signal after the price rebounded from 1.1585. Then the price managed to rise by about 16 pips that were barely enough to set a Stop Loss. So, when the price moved lower, my buy trade was closed with no losses. The next signal was formed near the same level of 1.1585 as the price rebounded from it again. But this time, it moved by just 10 pips, so I had to close my buy deal manually after the price went below 1.1585. The last sell signal was useless, as it became clear that the pair is trading flat and two false signals were formed near 1,1585.

As seen on the 30M time frame, volatility fell to the recent levels, and there is neither any definite trend nor a sideways channel. So it is rather difficult to define the current movement. Trading on the 30M time frame is still inconvenient, and the MACD signals are still better to be ignored. It would be a sound idea to wait for the formation of a trend line or a sideways channel. On the 5M time frame, the key levels for November 3 are 1.1535, 1.1585, and 1.1617 – 1.1622. The Take profit should be set at a distance of 30-40 pips as usual while the Stop loss can be placed at 15 pips away from a current price. On the 5M timeframe, the nearest level can serve as a target unless it is located too close or too far. Otherwise, use the Take Profit. The economic calendar on Wednesday is full of important reports. The United States will unveil the Non-farm Payrolls data and the Services ISM index. At the same time, the EU unemployment report will see the light. Later in the day, the Federal Reserve will announce its decision which will be the key event of the day.