Analysis and trading recommendations for EUR/USD and GBP/USD on August 2

Analysis of transactions in the EUR / USD pair

Euro fell on Friday despite good GDP and inflation reports from the Euro area.

Trading recommendations for August 2

EUR / USD will again move depending on the economic reports that the Euro area will release today. Strong data on manufacturing activity will lead to a price increase, while a weaker than expected report could result in another decline in the market. Then, in the afternoon, a similar report will be published from the US. This time, if the data expectations exceeds, dollar will regain its strength, which could lead to a decline in the pair.

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For long positions:

Open a long position when euro reaches 1.1882 (green line on the chart), and then take profit at the level of 1.1920. Demand will increase if the Euro area publishes strong economic data. 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 1.1857 and 1.1818, but the MACD indicator line must be in the oversold area in order to bring about a market reversal to 1.1882.

For short positions:

Open a short position when euro reaches 1.1857 (red line on the chart), and then take profit at the level of 1.1818. A decline will occur if the Euro area releases weak economic reports. 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 1.1882 and 1.1920, but the MACD line must be in the overbought area in order to provoke a market reversal to 1.1857.

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 decisions based on the current market situation is an inherently losing strategy for an intraday trader.

Analysis of transactions in the GBP / USD pair

Pound did not hit the local high last Friday. To be more specific, it was the multiple failed attempts to break through 1.3975 that led to the closure of many long positions in the market.

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Trading recommendations for August 2

Pound will trade today depending on the data on UK manufacturing activity. If the figure turns better than the forecast, then GBP/USD will increase rather sharply. Then, in the afternoon, a similar report will be published from the US. This time, if the data exceeds expectations, dollar will regain its strength, which could lead to a decline in the pair.

For long positions:

Open a long position when pound reaches 1.3910 (green line on the chart), and then take profit at the level of 1.3956 (thicker green line on the chart). GBP/USD will climb up if UK publishes good PMI data. 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 1.3885 and 1.3846, but the MACD line should be in the oversold area in order to set off a market reversal to 1.3910.

For short positions:

Open a short position when pound reaches 1.3885 (red line on the chart), and then take profit at the level of 1.3846. A decline will occur if UK releases weak economic reports. 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 1.3910 and 1.3956, but the MACD line should be in the overbought area in order to trigger a market reversal to 1.3885.

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/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 GBP/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 decisions based on the current market situation is an inherently losing strategy for an intraday trader.

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

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