EUR/USD: Tips for Beginner Traders for November 4th (U.S. Session)

[Ben Graham]

Analysis of trades and trading tips for the European currency

The price test of 1.1520 occurred when the MACD indicator had just started to move upward from the zero mark, confirming a proper entry point for buying the euro. As a result, the pair rose only by 10 points.

A complete absence of major news affected volatility and prevented euro buyers from achieving any decent correction. The main focus now shifts to FOMC member Michelle Bowman's speech and the release of the RCM/TIPP Economic Optimism Index data. Market participants will closely analyze Bowman's remarks on inflation prospects and the Federal Reserve's future policy strategy. Only signals of a more decisive rate-cutting stance could trigger a modest rise in risk assets, including the euro. Otherwise, pressure on the pair is likely to persist.

The RCM/TIPP Economic Optimism Index will also play a certain role, as it reflects the sentiment of U.S. businesses and consumers regarding the current economic situation and their outlook for the future. A rise in this index could indicate improved economic expectations and strengthen the dollar, while a decline might put pressure on the U.S. currency.

As for intraday strategy, I will focus mainly on Scenarios #1 and #2.

Buy Signal

Scenario #1: Today, you can buy the euro around 1.1520 (green line on the chart), targeting a rise to 1.1551. At 1.1551, I plan to exit the market and also open a short position in the opposite direction, expecting a 30–35-point pullback from the entry level. Note: A euro rise today is only likely within the framework of a correction.Important: Before buying, make sure the MACD indicator is above the zero line and just starting to rise from it.

Scenario #2: I also plan to buy the euro if the price tests 1.1497 twice while the MACD is in the oversold area. This will limit the pair's downward potential and lead to a reversal upward. A rise toward 1.1520 and 1.1551 can then be expected.

Sell Signal

Scenario #1: I plan to sell the euro after it reaches 1.1497 (red line on the chart). The target will be 1.1469, where I intend to exit the market and buy in the opposite direction, expecting a 20–25-point pullback from that level. Downward pressure on the pair may return at any moment.Important: Before selling, make sure the MACD indicator is below the zero line and just starting to move downward from it.

Scenario #2: I also plan to sell the euro if the price tests 1.1520 twice while the MACD is in the overbought area. This will limit the pair's upward potential and trigger a market reversal downward. A decline toward 1.1497 and 1.1469 can then be expected.

Chart Explanation:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – suggested level for setting Take Profit or manually fixing profit, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – suggested level for setting Take Profit or manually fixing profit, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important Notes

Beginner Forex traders should be extremely cautious when deciding to enter the market. Before major fundamental reports are released, it's best to stay out of the market to avoid sudden price swings. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you ignore money management and trade with large volumes.

Remember: Successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based solely on the current market situation are an inherently losing strategy for intraday traders.

The material has been provided by InstaForex Company - www.instaforex.com