To open long positions on EURUSD, you need:
From a technical point of view, nothing has changed, although the data on inflation in the Eurozone, which turned out to be much better than the forecasts of economists, provoked several attempts to break above the resistance of 1.0885, which I paid attention to in the morning. If you look at the 5-minute chart, you can see how the bears each time did not let the pair above this level and even tried to return to the lows of the day, which also failed. Now all the focus is shifted to the press conference of the President of the European Central Bank, Christine Lagarde, and data on the US labor market. It is best to open long positions when EUR/USD falls to the support area of 1.0840 and a false breakout is formed there, which will be the first signal to buy. If Lagarde does not announce new measures to help the economy, the pressure on the euro may increase. In this scenario, it is best to open long positions after updating the lows of the week in the area of 1.0812 and 1.0787. A larger level, where you can buy the euro immediately on the rebound, is seen in the area of 1.0755. An equally important task for the bulls will be to break through and consolidate above the resistance of 1.0885, which will lead to the continuation of the upward trend formed from the low of April 24 this year, and the test of new highs of 1.0916 and 1.0937, where I recommend fixing the profits.
To open short positions on EURUSD, you need:
Sellers made several unsuccessful attempts to start a bearish market from the level of 1.0885 and formed several false breakouts from it, which still retains the advantage on their side. While trading is below 1.0885, we can expect a further decline in the euro to the support area of 1.0840, but only a consolidation below will be a direct signal to open new short positions in the expectation of a decrease in EUR/USD to the lows of 1.0812 and 1.0787, where I recommend fixing the profits. A stronger downward momentum in the euro may be built after the speech of the President of the European Central Bank. The farthest goal of the bears at the end of this week remains the support of 1.0755. In a scenario of growth of pair in the second half of the day after reports on the condition of the US labor market, you can only open short positions on the formation of a false breakdown in the resistance area of 1.0916, but I recommend selling EUR/USD only for a rebound from a maximum of 1.0937 based on a downward correction in 30-40 points intraday.
Signals of indicators:
Moving averages
Trading is conducted in the area of 30 and 50 daily moving averages, which indicates temporary equality in the market.
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
The upper limit of the indicator in the area of 1.0885 has already worked out today and now the case is for the lower limit in the area of 1.0850, the breakdown of which will lead to a larger fall in the euro.
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
