EUR/USD – 1H.
Hello, traders! The euro/dollar pair performed a reversal in favor of the European currency on April 24 and started a fairly strong growth process. There are no new graphical constructions on the hourly chart at the moment, so you need to look for goals and signals on older charts, for example, on the 4-hour chart. The new week promises to be very interesting in terms of information. There will be meetings of the ECB and the Federal Reserve, as well as a large number of important economic reports, including US GDP, EU GDP, as well as unemployment and inflation in the EU. Traders do not expect any monetary policy changes from the two central banks. However, this does not mean that they will not be there or that their heads will not tell traders anything important. Meanwhile, America is preparing to open its economic borders, as stated by US Treasury Secretary Steven Mnuchin. Depending on the pandemic, this is expected to happen in May or June of this year, so the economy will start growing in July or August. However, no one still knows what will be the epidemiological consequences of measures to remove the quarantine. Will the second wave of the coronavirus epidemic begin?
EUR/USD – 4H.
On the 4-hour chart, the quotes of the euro/dollar pair performed a reversal in favor of the European currency and continue the growth process in the direction of the downward trend line, which is now the main graphical construction that preserves the "bearish" mood of most traders. Thus, the rebound of the pair's exchange rate from this line will work in favor of the US currency and resume falling in the direction of the corrective level of 0.0% (1.0638). Fixing the pair's rate above this line will allow traders to expect continued growth in the direction of the corrective level of 38.2% (1.0964). No new emerging divergences are observed in any indicator today.
EUR/USD – Daily.
On the daily chart, the euro/dollar pair made a consolidation under the Fibo level of 23.6% (1.0840), as well as under the "narrowing triangle", which increases the probability of further fall of the pair. However, even today, a close above the corrective level of 23.6% can be performed, which will work in favor of the EU currency and resume the growth process in the direction of 38.2% (1.0965).
EUR/USD – Weekly.
On the weekly chart, the euro/dollar pair continues to trade near the bottom line of the "narrowing triangle". The rebound of quotes from this line still allows us to expect an increase in quotes in the long term in the direction of the level of 1.1600 (the upper line of the "triangle"). Closing the pair under the "triangle" will work in favor of the US currency and, possibly, a new long fall.
Overview of fundamentals:
On April 24, the European Union did not release any important reports and news, and in America - only one - on the change in the volume of orders for long-term goods, which showed a strong reduction in the main indicator, immediately by 14.4%. Traders could not get past this report and the dollar began to decline in the afternoon and continues to do so today.
News calendar for the United States and the European Union:
On April 27, the calendar of economic events in the European Union and the United States does not contain any important reports and events.
COT (Commitments of Traders) report:
A new COT report shows that during the reporting week, major market players again increased their contracts. The total number of long and short contracts has also increased. Even the long category saw a bigger increase, although this did not help the euro currency too much last week. The overall advantage remains in favor of short, 560,000 against 532,000. However, the advantage is not too strong. Over the past three months, every COT report has shown the advantage of bear traders. However, during this time, the euro not only fell but also grew. Thus, I would say that the overall trend remains "bearish", that is, in the long term, I would expect further falls in the quotes. But this does not mean that there is no chance of growth at all. A buy signal is brewing on the 4-hour chart.
Forecast for EUR/USD and recommendations to traders:
At this time, I recommend selling the euro with the goal of 1.0638, if the rebound from the trend line is performed on the 4-hour chart. I recommend buying euros after fixing the quotes above the downward trend line on the 4-hour chart with the goal of 1.0964.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency, not for speculative profit, but to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
