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19.12.202413:55 Forex Analysis & Reviews: EUR/USD: Simple Trading Tips for Beginner Traders on December 19th (U.S. Session)

Relevancia 06:00 2024-12-20 UTC--5

Analysis of Trades and Advice for Trading the Euro

The first test of the 1.0400 level occurred when the MACD indicator had already moved significantly above the zero mark, which, in my opinion, limited the pair's upward potential. For this reason, I did not buy the euro. The second test of 1.0400 a short time later, with the MACD in the overbought zone, triggered Scenario #2 for a sell trade. However, the pair did not decline, resulting in losses being recorded.

It was surprising to see how persistently the euro resisted falling following yesterday's significant sell-off after the FOMC meeting. Today, an increase in initial jobless claims could provide further momentum for euro growth. Conversely, a decrease in claims could signal a recovering US economy and improved consumer confidence, potentially strengthening the dollar. Investors will closely watch these data, as they influence expectations for Federal Reserve actions.

The Q3 GDP data will also play a key role. Higher GDP growth indicates economic expansion, which could prompt the Fed to maintain elevated interest rates. Higher rates make the dollar more attractive. On the other hand, disappointing data could undermine confidence in the dollar.

Additionally, existing home sales data is another important indicator. An increase in sales may reflect improvements in the housing market and the broader economy.

For intraday strategies, I will focus on implementing Scenarios #1 and #2.

Exchange Rates 19.12.2024 analysis

Buy Signal

Scenario #1: Today, I plan to buy the euro if the price reaches 1.0423 (green line on the chart), targeting a rise to 1.0459. At 1.0459, I plan to exit the market and sell the euro in anticipation of a 30–35 point retracement. A euro rally today is only expected if US statistics are weak.Important! Before buying, ensure that the MACD is above the zero line and just starting to rise from it.

Scenario #2: I also plan to buy the euro if there are two consecutive tests of 1.0402, with the MACD in the oversold zone. This will limit the pair's downward potential and trigger a market reversal to the upside. A rise toward 1.0423 and 1.0459 can be expected.

Sell Signal

Scenario #1: I plan to sell the euro after it reaches 1.0402 (red line on the chart), targeting a drop to 1.0375, where I plan to exit the market and immediately buy back the euro in anticipation of a 20–25 point retracement. Pressure on the pair will return if US GDP data are strong.Important! Before selling, ensure that the MACD is below the zero line and just starting to decline from it.

Scenario #2: I also plan to sell the euro if there are two consecutive tests of 1.0423, with the MACD in the overbought zone. This will limit the pair's upward potential and lead to a reversal to the downside. A decline toward 1.0402 and 1.0375 can be expected.

Exchange Rates 19.12.2024 analysis

Chart Details

  • Thin green line: Entry price for buying the instrument.
  • Thick green line: Projected level to set Take Profit or manually close positions, as further growth above this level is unlikely.
  • Thin red line: Entry price for selling the instrument.
  • Thick red line: Projected level to set Take Profit or manually close positions, as further declines below this level are unlikely.
  • MACD Indicator: Use overbought and oversold zones as guides when entering trades.

Important Notes

Beginner Forex traders should approach market entry decisions with great caution. Before key fundamental reports, it is best to remain out of the market to avoid sharp price swings. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you fail to manage risk and trade large volumes.

Remember, successful trading requires a clear trading plan, like the one outlined above. Making spontaneous decisions based on the current market situation is an inherently losing strategy for intraday traders.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Jakub Novak,
Analytical expert of InstaSpot
© 2007-2024
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