EUR/USD – 1H.
On September 3, the EUR/USD pair increased to the corrective level of 61.8% (1.1857), rebounding from it and turning in favor of the US currency. Thus, the fall is currently resumed in the direction of the Fibo levels of 76.4% (1.1821) and 100.0% (1.1762). So far, the entire period of the fall of the euro currency and the growth of the dollar can not be called strong. It looks impressive on the hourly chart, however, it looks depressing on the older charts. Thus, I believe that it is too early to conclude a complete change in the mood of traders to "bearish". The US dollar may even continue the process of growth in the direction of its previous low - around the level of 1.1762. What will happen next is not yet clear. The main thing is that the situation in America has not changed in the current week. Leading epidemiologists of the country continue to assure that in 2020, we should not wait for a vaccine against coronavirus, and this is despite the promises of Donald Trump to create a vaccine this year and the third stages of testing by three American pharmaceutical companies of three new vaccines. However, doctors continue to argue that the process of creating a safe and effective vaccine will take much longer. There is no positive economic news. The country is approaching the presidential election and it is not known what other surprises are awaiting us in 2020.
EUR/USD – 4H.
On the 4 hour chart, the quotes of the EUR/USD pair made a reversal in favor of the US currency and started falling towards the upward trend line which still characterizes the mood of the traders as "bullish", as well as the level to 127.2% (1.1729). The rebound of quotes from any of these barriers will work in favor of the EU currency and the resumption of the growth process in the direction of the corrective level of 161.8% (1.2027). Closing the pair's exchange rate under the trend line will increase the probability of a further fall in the direction of the Fibo level of 100.0% (1.1496).
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair completed another reversal in favor of the US dollar and started falling towards the lower border of the upward trend of the corridor, the closure of which will allow traders to further decline towards the next corrective level.
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair performed a consolidation over the "narrowing triangle", which now allows us to count on further growth of the euro currency.
Overview of fundamentals:
On September 3, a report on applications for unemployment benefits was released in America, which was significantly better than traders' expectations. Also, the ISM index for the service sector did not disappoint traders. The European retail report was disappointing, significantly weaker than expected.
News calendar for the United States and the European Union:
US - unemployment rate (12:30 GMT).
US - change in the number of people employed in the non-agricultural sector (12:30 GMT).
US - change in average hourly earnings (12:30 GMT).
On September 4, the most important reports on unemployment and Nonfarm will be released in America. These data can have a significant impact on the US dollar.
COT (Commitments of Traders) report:
The latest COT report was very revealing. According to the results of the reporting week, major traders of the "Non-commercial" group opened 1302 new long contracts and closed 11 thousand short contracts. Thus, their mood became even more "bullish". The difference between the total volumes of long and short contracts focused on their hands has increased even more. Thus, the "bullish" mood of speculators has been growing continuously since June 20, which allows us to conclude that the upward trend for the euro/dollar pair continues. The "Commercial" group, which usually trades against the trend, opened 7 thousand short-contracts during the reporting week, and the total number of short-contracts for all groups of traders decreased by 7 thousand, and long-contracts - by a thousand. A new COT report will be released today.
Forecast for EUR/USD and recommendations for traders:
Today, I recommend selling the euro currency with targets of 1.1821-1.1762, as it was rebounded from the level of 61.8% (1.1857) on the hourly chart. I recommend new purchases of the pair if there is a rebound from the trend line on the 4-hour chart with the goal of 1.1900.
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.
