On Thursday, EUR/USD completed a cycle of an upward movement and moved sharply down. It seems that the market has not received any confirmation that a peace treaty can soon be signed between Ukraine and Russia. For your reference, the uptrend of the euro started on Tuesday in parallel with the Russia-Ukraine negotiations that took place in Turkey. After the reports that the two sides had made noticeable progress, high-risk currencies received upside momentum. Yet, it turns out that this was a short-lived trend. Amid the uncertain time frames of when the peace treaty will be signed, markets quickly realized that this can take months. Until then, the so-called special military operation in Ukraine will go on and will continue to hurt the European economy. Thus, the fall of the euro is solely associated with geopolitics. There were almost no macroeconomic events on Thursday. The unemployment report in the EU and the data on initial jobless claims in the US were almost ignored by the market.
On the 5-minute time frame, the pair's movements were far from perfect. Throughout the European trading session, the pair was holding in a trend. Yet, during the American session, the movements of the pair became ragged, making it hard to trade. The session started with the formation of a false buy signal. The price consolidated above the level of 1.1165 but failed to move higher by even 10 pips. Therefore, a long position brought a small loss to novice traders. On the other hand, the next sell signal turned out to be quite strong, and the pair went down by almost 100 pips in total to the level of 1.1070. It was possible to earn at least 70 pips on this short position. When falling towards 1.1070, the pair paused near the level of 1.1106. At first, it broke through this level but then bounced off it twice. However, the quote failed to consolidate above this level, which means that traders should have just stayed in their short positions. A rebound from 1.1070 could also have been used as it was a buy signal. After its formation, the price went up by 50 pips and settled above the level of 1.1106. Yet, it could not continue the uptrend and reversed back below the level of 1.1106. At this point, traders should have closed their positions. This trade brought a small profit, but in total beginners could have earned no less than 70 pips on Thursday.
Trading tips on Friday
On the 30-minute time frame, the pair started a correction within the ongoing uptrend. Unfortunately, there is no trendline or channel at the moment, so we can just assume that there is a certain trend. We added several new levels to the chart and removed the old ones as the price showed no reaction to them. The fundamental and geopolitical backgrounds confirm a new fall in the European currency. On the 5-minute time frame on Friday, it is recommended to trade at the levels of 1.1019, 1.1038, 1.1070, 1.1132, 1.1184, and 1.1228. You should set a Step Loss to break even as soon as the price passes 15 pips in the right direction. No important reports are expected in the EU on Friday. The US will release the data on the labor market and wages. The key report of the day will be the Nonfarm Payrolls. Although the geopolitical factor may diminish its importance, this report is usually always in the focus of attention.
