On Tuesday, trading on EUR/USD was again inconvenient for market players, especially for beginners. Several macroeconomic reports were published. They were either ignored by traders or came out too disappointing to somehow affect the market. Anyway, the euro/dollar pair started the day near the level of 1.1234 and ended it there. Volatility on Tuesday was 56 pips, which was not much. Nevertheless, the quote left the downward channel, canceling the downtrend. It would be good to know that the downtrend is actually canceled and the pair can now move up. However, there is reason to doubt. On Thursday, the ECB will announce the outcome of its monetary policy meeting, which may exert pressure on the euro. On Wednesday, the eurozone inflation report will be published. If it is in line with the forecast, the euro may go down. In other words, the single European currency is highly likely to be bearish on Wednesday. This scenario will play out if the quote consolidates below 1.1234.
On the M5 chart, the level of 1.1262 turned out to be exactly in the middle of the range in which the pair was trading all day. As a result, most of the trading signals produced near this mark were false. Let's analyze all the trading signals more thoroughly. Firstly, the pair rebounded from the level of 1.1234, signaling to go long. Then, it broke through the level of 1.1262 but failed to reach the 1.1285 mark. So, it was time to close trades either manually or after the quote had settled below the level of 1.1262. The maximum profit yielded was 10 pips. As soon as the price consolidated below 1.1262, short positions could be opened. The quote then rebounded from 1.1234, and it was the time to close short trades. The maximum profit yielded was again 10 pips. The last buy signal was weak enough to enter the market because the movement was sluggish during the day and the signals produced were inaccurate. As a result, Tuesday trading brought beginners no more than 20 pips in profit, which was also not bad.
Trading plan for Wednesday:
In the 30M time frame, the downtrend is canceled. The price consolidated above 1.1234, indicating bullish market sentiment. If the quote falls below the mark in the next couple of days, the downtrend may resume. The target levels in the 5M time frame are seen at 1.1170-1.1186, 1.1227-1.1234, 1.1285-1.1292, and 1.1315. There are no other levels below 1.1121 because the price has not been there for more than a year. Therefore, it will be more difficult to trade there. The European economic calendar contains a single report on inflation. The data are very important and may trigger turbulence in the market. Therefore, traders should pay close attention to the release. The ADP jobs statistics will come out in the United States. It has less influence on the market than Nonfarm Payrolls. Therefore, market participants are unlikely to show any reaction to the results.
