EUR/USD: This will be a busy week for traders...
Forces were balanced on the EUR/USD, with the single currency retaining aficionados amid persistent appetite for risk and the note retaining a clear advantage as the Fed appears unwilling to lower its key rates to very short term. The latest statistics, on growth, employment and especially prices, argue in this direction.
Remember that prices therefore increased at a monthly rate of 0.4% in January, compared to 0.2% in December.
"The level of 2% to be reached is complicated and uncertain" for Emmanuel Auboyneau, Amplegest partner. "In addition to a possible rise in raw materials boosted by economic growth, it is above all wages which are the key variable. After a lull of several months, they have recently resumed the upward trend, which is consistent with the strength of the job market. Furthermore, rents which constitute 30% of the price index have stabilized but remain subject to the structural shortage of housing in the United States."
The CME's FedWatch tool puts the probability of a rate cut on May 1 at the end of the FOMC at 25.9%.
M Auboyneau remains convinced "that 2024 will be the year when the rate cut begins, but in a moderate way and only from the second half of the year."
"After a period of calm, central banks are back,? says Christopher Dembik, investment strategy advisor at Pictet AM."
"Given the pronounced deterioration of the economic situation in the euro zone, logic would dictate that the European Central Bank (ECB) quickly lower its rates in order to support the parts of the economy most in difficulty, such as real estate. But this will not happen. The ECB will certainly wait wisely for the American Federal Reserve (Fed) to begin the cycle of monetary easing in order to do the same. In short, a new monetary policy error to be attributed to the ECB. This is not the first. In the midst of the global financial crisis, the ECB led by Jean-Claude Trichet had increased its key rate because of possible pressure on prices linked to oil. Great mistake. It was then necessary to lower the rates more than designed to help States and banks in difficulty. It is said that you never learn from your mistakes..."
Published on Friday, inflation in the euro zone slowed in February but a little less than expected. It rose to 2.5% over one year compared to 2.8% in January. But the consensus established by Reuters was 2.4%.
Forex traders will have a busy second part of the week in terms of the calendar with hearings from J Powell before parliamentarians on Wednesday and Thursday, the outcome of the ECB Governing Council on Thursday, and numerous benchmarks on American employment, before the statistical highlight on Friday with the NFP (Non Farm Payrolls) report, a federal report on the health of American private employment. Operators will not be monitoring the health of employment, which is undoubtedly very good, but the persistence of tensions, particularly wage tensions, which contribute to the resistance of the inflationary phenomenon that the Fed has been trying to contain for months.
In the immediate future, the Sentix investor confidence index in the Euro Zone has just risen slightly although in negative territory, at -10.4. The institute provides the following commentary on the leading economic power in the Eurozone: ""The German economy is increasingly turning into a "ghost train". Given the improvement in global data, it is becoming increasingly increasingly obvious that it is Germany's atypical, unfortunately ineffective, economic policy that is preventing a complete economic recovery in the heart of Europe. The recession remains ongoing and the data even continues to deteriorate. The situation is as fragile as it was in July 2020 in the middle of the Covid crisis."
Right now, the EUR/USD is trading at $1.0854.
KEY CHART ELEMENTS
The 20-day moving average (in dark blue), which until now conveniently served us as a trailing stop, has been clearly exceeded. We therefore no longer offer short positions, and remain on the lookout for a new attractive entry point. If the spot were to break its 20-day moving average in a significant level of volatility, we could then speak of a false exit since February 20. This dynamic level is to be monitored, therefore.
MEDIUM TERM FORECAST
Considering the key graphical factors that we have mentioned, our opinion is neutral in the medium term on the EUR/USD.
We will maintain this neutral opinion as long as EUR/USD prices are positioned between support at $1.0810 and resistance at $1.0940.
FAQs
The 3 5 7 rule works on a simple principle: never risk more than 3% of your trading capital on any single trade; limit your overall exposure to 5% of your capital on all open trades combined; and ensure your winning trades are at least 7% more profitable than your losing trades.
How much money do day traders with $10,000 accounts make per day on average? ›
How much money do day traders with $10000 accounts make per day on average? On average, day traders with $10,000 accounts can make $200-$600 per day, with skilled traders aiming for 2%-5% returns daily. So, it is possible to achieve a daily profit of $200 to $600 with a $10,000 account.
How many trades should a trader take in a day? ›
The number of trades you should make in a day in forex is highly dependent on your trading style, experience, risk tolerance, market conditions, and overall strategy. Quality always trumps quantity, and it's essential to focus on well-planned, high-probability trades rather than trying to meet a specific daily quota.
What is the success rate of day traders? ›
Day traders choose their position before the market closes and reap the rewards. It is a high-risk and high-rewards venture. Around 1% – 20% of traders earn a profitable margin at the end of the day. The low success rate often discourages the newbies who learn new ways from an online course or television.
What is 90% rule in trading? ›
The 90 rule in Forex is a commonly cited statistic that states that 90% of Forex traders lose 90% of their money in the first 90 days. This is a sobering statistic, but it is important to understand why it is true and how to avoid falling into the same trap.
What is the 11am rule in stock trading? ›
What Is the 11am Rule in Trading? If a trending security makes a new high of day between 11:15-11:30 am EST, there's a 75% probability of closing within 1% of the HOD.
Can you make 200k a year day trading? ›
Yes, it's certainly possible to make $200,000.00 per year day trading, but you're looking at your potential profit capacity in the wrong way. You need to take into consideration how much money you have available to trade with, known as your initial capital.
Can I make 1000 per day from trading? ›
Conclusion. Making a daily profit of Rs. 1000 in the stock market is not guaranteed and depends on numerous factors, including your trading skills, discipline, and market conditions. Following a well-structured approach can improve your chances of success.
How much can I make day trading with $5000? ›
If you get 10 trading signals per week, then you can expect a weekly return of $180-$200 on a $5,000 account. Which is a phenomenal result! Think about it: With a simple day trading strategy like this, you could expect $720 – $800 per month on a $5,000 account.
What are the golden rules of trading? ›
Cut your losses quickly: Never let a loss get out of control. Trade with the trend: Follow the market's direction. Do not trade every day: Only trade when the market conditions are favorable. Follow a trading plan: Stick to your strategy without deviating based on emotions.
Day traders typically target stocks, options, futures, commodities, or currencies (including crypto). They enter and exit positions within the same day (hence the term day traders). They hold positions for hours, minutes, or even seconds before selling them. They rarely hold positions overnight.
What is the average profit of a day trader? ›
Most day traders give up after less than a month. It is therefore all the more important to start day trading on a Demo depot to learn. A typical day trading profit per day is between 0.033 and 0.13 percent. This corresponds to a monthly profit of between 1 and 10 percent for successful day traders.
Who is the richest day trader? ›
George Soros is perhaps the most renowned trader in the world, famous for “breaking the Bank of England” in 1992. His audacious bet against the British pound earned his fund over $1 billion in a single day.
Can you live off day trading? ›
It is possible to earn money with day trading and make a living from it and generate high income - but the chances are extremely low. A maximum of three percent of all traders achieve long-term profits; the vast majority lose large sums of money.
Is trading luck or skill? ›
There is an element of luck at play in the stock market. Of course, skill and hard work will play a part in your success, but other factors such as timing and luck also play a part in a stock's performance. For instance, there are times when stocks go on streaks and outperform themselves.
What is the 357 trading strategy? ›
What is the 3 5 7 rule in trading? A risk management principle known as the “3-5-7” rule in trading advises diversifying one's financial holdings to reduce risk. The 3% rule states that you should never risk more than 3% of your whole trading capital on a single deal.
What is the golden rule of traders? ›
Cut your losses quickly: Never let a loss get out of control. Trade with the trend: Follow the market's direction. Do not trade every day: Only trade when the market conditions are favorable. Follow a trading plan: Stick to your strategy without deviating based on emotions.
What is the 80 20 rule in trading? ›
In investing, the 80-20 rule generally holds that 20% of the holdings in a portfolio are responsible for 80% of the portfolio's growth. On the flip side, 20% of a portfolio's holdings could be responsible for 80% of its losses.
What is the 70 30 rule in trading? ›
The strategy is based on:
Portfolio management with 70% hedge and 30% spot delivery. Option to leave the trade mandate to the portfolio manager. The portfolio trades include purchasing and selling although with limited trading activity. Optimisation on product level: SYSTEM, EPAD, EEX, periods, base, peak.
