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Analysis and trading recommendations for EUR/USD on August 25

Analysis of transactions in the EUR / USD pair

Euro rose by 20 pips on Tuesday, thanks to the signal to buy that coincided with the MACD line being at the oversold area. Sadly, there was no further growth because the indicator was far away from zero in the afternoon.

Surprisingly, the better-than-expected GDP data from Germany did not affect the market much yesterday. The speech of ECB member Isabel Schnabel was also practically ignored, as it did not concern monetary policy. But in the afternoon, euro's rally halted because of good data on US home sales.

Most likely, the bullish move will continue provided that upcoming reports from Germany exceed expectations. But if the figures decline, EUR / USD will drop in price as well. Then, the scenario could escalate in the afternoon if US releases strong data on orders for durable goods.

For long positions:

Open a long position when euro reaches 1.1754 (green line on the chart), and then take profit at the level of 1.1796. EUR / USD may climb higher if data from Germany exceeds expectations. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.

It is also possible to buy at 1.1733 and 1.1693, but the MACD indicator line must be in the oversold area, as only by that will the market reverse to 1.1754 and 1.1796.

For short positions:

Open a short position when euro reaches 1.1733 (red line on the chart), and then take profit at the level of 1.1693. A decline will occur if Germany releases weak economic indicators and if the ECB takes a wait-and-see position on monetary policy. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

It is also possible to sell at 1.1754 and 1.1796, but the MACD line must be in the overbought area, as only by that will the market reverse to 1.1733.