EUR/USD – 1H.
Hello, traders! The euro/dollar pair on the hourly chart on June 18 continues a weak drop in quotes within the downward trend corridor. Thus, in general, we can conclude that the mood of traders remains "bearish". Yesterday and today, the information background for the euro/dollar pair was and will be very poor. Yesterday there was only a report on applications for unemployment benefits in the US, and today Jerome Powell will make another speech. However, I believe that all the most important things have been said by Powell on Tuesday, so his today's speech may attract a little attention. Also, the EU summit will be held today, where a decision will be made on the creation of a fund for the recovery of the Eurozone countries after the COVID-2019 pandemic crisis. Let me remind you that the northern and southern EU countries cannot agree on the terms on which the former will help the latter. Today, this issue may, if not resolved, at least become clearer. Without this 750 billion euro aid package, the European economy will have a very difficult time in 2020. The most affected countries may be forced to default if the European Union does not help overcome the crisis.
EUR/USD – 4H.
On the 4-hour chart, the quotes of the euro/dollar pair also continue the process of falling in the direction of the corrective level of 61.8% (1.1167). Thus, the "bearish" mood of traders is visible on the current chart. Also, there is a downward trend line, which also visualizes the mood of traders now. The rebound of the pair's exchange rate from the Fibo level of 61.8% will work in favor of the euro currency and some growth in the direction of the trend line. Closing quotes above the trend line will increase the probability of further growth in the direction of the corrective level of 100.0% (1.1496). Fixing quotes below the Fibo level of 61.8% will work in favor of continuing the fall in the direction of the corrective level of 50.0% (1.1065).
EUR/USD –Daily.
On the daily chart, the euro/dollar pair made a consolidation under the Fibo level of 127.2% (1.1261). Thus, now the fall in quotes can be continued in the direction of the next corrective level of 100.0% (1.1147), which corresponds to the indications of the younger charts.
EUR/USD – Weekly.
On the weekly chart, the euro/dollar pair rebounded from the lower line of the "narrowing triangle", which still allows traders to expect growth in the direction of the 1.1600 level (the upper line of the "triangle"). However, the lower charts are now in a more bearish mood, so working out this goal is being postponed for now.
Overview of fundamentals:
On June 18, there was no news in the European Union, and in the US – a report on initial and repeated applications for unemployment benefits. However, even this single report did not interest traders too much, who continued calm sales of the euro and purchases of the dollar during the day.
News calendar for the United States and the European Union:
US - Federal Reserve Board of Governors Chairman Jerome Powell will deliver a speech (17:00 GMT).
On June 19, the EU news calendar was empty again. And in the US, only one more speech by Fed Chairman Jerome Powell is scheduled. I also remind you about the EU summit, however, it is unlikely that decisive information will be received from it today. The day promises to be calm.
COT(Commitments of Traders) report:
The latest COT report showed very interesting changes in the mood of large traders. The "Non-commercial" group has increased the number of long-contracts by 12,500, while not forgetting to get rid of short-contracts. Since it is believed that this group is driving the currency market, nothing is surprising in the growth of the European currency, according to this report. Hedgers very logically recruited opposite contracts, since this is the essence of their activity (+20766 short contracts). Thus, over the past two weeks, the euro currency has lost 8 thousand short contracts and gained 12,500 long contracts. The current trading week has shown that bull traders are sated with purchases of the euro currency. A new COT report will be released today.
Forecast for EUR/USD and recommendations to traders:
Today, I recommend selling the euro currency with the goal of 1.1167, since the closing was performed under the level of 1.1294 on the 4-hour chart. The next target is 1.1065. Purchases of the pair can be opened when closing above the ascending corridor on the hourly chart or above the trend line on the 4-hour chart with a goal of 1.1496.
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.
