The test of the 1.1603 price occurred when the MACD indicator was just starting to move upward from the zero level, confirming the validity of the entry point for buying the euro. As a result, the pair rose by only 10 points.
The August eurozone business activity report confirmed that the economy was consolidating at the levels already reached, but the single currency remained almost unresponsive to the data. The composite PMI held at 52.0, matching the July high, while services activity declined slightly to 51.6. Since both readings came in slightly below preliminary estimates and contained no surprise, there was virtually no reaction in EUR/USD, and the euro continued to focus on external factors. Nevertheless, the internal structure of the report was encouraging. Private-sector employment increased for the first time in a year, while new export orders rose for the first time in four and a half years amid a recovery in industrial activity. The picture across countries remained mixed, as growth was driven by Spain and Italy, Germany accelerated at the fastest pace since March, while France continued to contract for the eighth consecutive month.
In the second half of the day, the euro will remain focused on a busy U.S. economic calendar, which will include the services business activity index, the composite PMI, weekly jobless claims, and the foreign trade balance. The PMI figures will show whether the largest economy continues to maintain business activity and, in turn, will influence expectations for the Federal Reserve's interest rate. Additional volatility may come from speeches by FOMC members Christopher Waller, Beth Hammack, and Austan Goolsbee, whose comments could further highlight divisions within the regulator. Differences of opinion between hawkish policymakers and those favoring a cautious approach make the outlook more difficult, which means increased sensitivity for the single currency to every signal. Weak data combined with dovish rhetoric will support EUR/USD, while strong statistics and hawkish comments will restore the dollar's initiative.
As for the intraday strategy, I will focus more on implementing Scenarios No. 1 and No. 2.
Scenario No. 1: Today, the euro can be bought when the price reaches around 1.1610 (the green line on the chart), with a target of 1.1632. At 1.1632, I plan to exit the market and also sell the euro in the opposite direction, targeting a move of 30–35 points from the entry point. The euro can be expected to rise today only after weak U.S. data. Important! Before buying, make sure that the MACD indicator is above the zero level and is just starting to rise from it.
Scenario No. 2: I also plan to buy the euro today if the price tests 1.1598 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal of the market to the upside. A rise toward the opposite levels of 1.1610 and 1.1632 can be expected.
Sell SignalScenario No. 1: I plan to sell the euro after the price reaches 1.1598 (the red line on the chart). The target will be 1.1580, where I plan to exit the market and immediately buy in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair will return if U.S. data are strong. Important! Before selling, make sure that the MACD indicator is below the zero level and is just starting to decline from it.
Scenario No. 2: I also plan to sell the euro today if the price tests 1.1610 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal of the market to the downside. A decline toward the opposite levels of 1.1598 and 1.1580 can be expected.
Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid being caught in sharp exchange-rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.
And remember that successful trading requires a clear trading plan, such as the one presented above. Making trading decisions spontaneously based on the current market situation is an inherently losing strategy for an intraday trader.