FX.co ★ Analysis and trading tips for EUR/USD on October 4

Analysis of transactions in the EUR / USD pair

Given that inflation in the Euro area continues to break records, it is possible that today's report on producer prices will make a lot of noise, especially when growth turns out as predicted, that is, by 43.1% y/y. This data is largely tied to energy products, but this does not negate the fact that prices will continue to remain high even against the aggressive policy of the European Central Bank. This means that everyone should pay attention to the meeting of Finance Ministers as something may be adopted to support the population. In the afternoon, a number of Fed representatives will speak, followed by the release of data on manufacturing orders in the US. The latter will not be of great interest to traders, so there is a chance for a continued rise in EUR/USD.

For long positions:

Buy euro when the quote reaches 0.9846 (green line on the chart) and take profit at the price of 0.9895. Growth will occur if economic reports in the Euro area exceed expectations. Take note that when buying, the MACD line should be above zero or is starting to rise from it.

Euro can also be bought at 0.9816, but the MACD line should be in the oversold area as only by that will the market reverse to 0.9846 and 0.9895.

For short positions:

Sell euro when the quote reaches 0.9816 (red line on the chart) and take profit at the price of 0.9760. Pressure may return after the speeches of Fed representatives. Take note that when selling, the MACD line should be below zero or is starting to move down from it.

Euro can be sold at 0.9846, but the MACD line should be in the overbought area as only by that will the market reverse to 0.9816 and 0.9760.

What's on the chart:

The thin green line is the key level at which you can place long positions in the EUR/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the EUR/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.