Analysis of previous deals:
30M chart of the EUR/USD pair
The EUR/USD pair showed volatility equal to 33 points on Friday. In principle, the review can be completed. Seriously though, the pair continues to trade within the horizontal channel, which is clearly visible. The price has remained within the 1.1756 and 1.1851 levels in recent weeks, but spends most of the time in the lower area of this channel. In addition, volatility is very low almost every day. This week, only Thursday was an exception, when the European Union summed up the results of the European Central Bank meeting. And on Friday, it should be noted that there were even certain macroeconomic reports that day. However, the markets showed no desire to trade the pair. All published indexes of business activity in the United States and the European Union turned out to be versatile. Some slightly decreased, some slightly increased, but the fact remains - none of them caused a reaction from the markets. There is no point in talking about the trend line on the 30-minute timeframe now. It does not exist, therefore it is not recommended to trade on this timeframe now.
5M chart of the EUR/USD pair
In fact, only two trading signals were generated on the 5-minute timeframe last Friday. Although, given the low volatility throughout the day, this is not surprising at all. The euro/dollar pair reached the level of 1.1756 twice, bounced twice, and respectively, two buy signals were generated. Both were accurate enough that novice traders could work it out. The first one closed at Stop Loss, set at breakeven, since the price went up 15 points after the signal was generated, but failed to reach the level of 1.1787. The second long position should have been manually closed at a profit of about 8-10 points in the late afternoon, as the price failed to reach the nearest target level again. Thus, the most that novice traders could earn on Friday was up to 10 points of profit. On the other hand, it is very good that there were no blatant false signals that would lead to serious losses. Or there was not a large number of signals, which would also lead to losses in a flat.
Trading tips for Monday:
There is still a flat on the 30-minute timeframe. The horizontal channel is clearly visible, and the pair continues to show rather weak volatility, so we still do not recommend beginners to trade on this timeframe. Here you need to wait for the formation of a trend line or channel and only after that should you monitor signals from the MACD indicator. On the 5-minute timeframe, it is recommended to trade from the levels of 1.1738, 1.1752, 1.1756, 1.1787, 1.1802, 1.1831. Take Profit, as before, is set at a distance of 30-40 points. Stop Loss - to breakeven when the price passes in the right direction by 15-20 points. At the 5M TF, the target can be the nearest level if it is not too close or too far away. If located - then you should act according to the situation. The European Union will not have any important macroeconomic publications on Monday. In America, there will be only one report on durable goods orders for June. In theory, it can have a certain impact on the US currency rate, but in practice this is unlikely to happen.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels. Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.
The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
The material has been provided by InstaForex Company - www.instaforex.com