To open long positions on EURUSD, you need:
In the first half of the day, I paid attention to the importance of the level of 1.0851, around which the trade was conducted, and recommended opening long positions in the scenario of consolidation above this range, which passed. Fixing is clearly visible on the 5-minute chart. The next target for euro buyers is the upper limit of the side channel 1.0894 since only its break will strengthen the demand for the euro/dollar pair, which will lead to an update of the highs of 1.0937 and 1.0985, where I recommend fixing the profits. However, without good news on the EU summit, which will be held tomorrow, we can hardly expect such active growth. In the scenario of a decline in the pair in the second half of the day to the support area of 1.0851, it is best to open new long positions from there only after the formation of a false breakout, but I recommend buying the euro/dollar pair immediately on the rebound only from the lower border of the side channel 1.0814. Given that the release of important fundamental data is not planned for the North American session, it is likely that trading will remain on the channel.
To open short positions on EURUSD, you need:
Sellers of the euro will not rush to return to the market and will most likely show themselves after updating the upper border of the side channel 1.0894. However, it is best to open short positions from there in the second half of the day only after a false breakout, as the bulls managed to turn the market in their direction, updating the highs of yesterday and not letting the euro below the support of 1.0851, which is just the first goal of the bears. A breakout and consolidation below this range will increase the pressure on the euro/dollar pair, which will push the pair to the lower border of the side channel 1.0814, where I recommend fixing the profits. In the scenario of no pressure on the euro from the resistance of 1.0894, short positions are best postponed until the test of a more recent high of 1.0937.
Signals of indicators:
Moving averages
Trading is conducted just above the 30 and 50 daily moving averages, which indicates that there are no people willing to sell euros in the current conditions.
Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger Bands
Volatility is decreasing, which indicates a wait-and-see attitude of traders before tomorrow's EU summit.
Description of indicators
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
- MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
- Bollinger Bands (Bollinger Bands). Period 20
