After falling to the key psychological level of 1.2000, the main currency pair of the Forex market began to recover, however, it is not yet possible for the bulls to overcome the landmark mark of 1.2200 in the euro currency. The situation and market sentiment can be viewed from both perspectives. On the one hand, risk appetite is fueled by the fiscal stimulus in the US and the recovery of several countries from the COVID-19 pandemic. On the other hand, investors are in no hurry to rush into risky operations, as the timing of the global economic recovery is still in great doubt. So, many leading economists believe that economic activity, which was observed before the outbreak of the coronavirus epidemic, will recover only by the middle or end of 2022, or even later.
However, the COVID-19 strains are constantly mutating and finding new outlines, which threatens the normalization of the situation. The softer financial conditions that Federal Reserve Chairman Jerome Powell spoke about on the Senate floor mean that interest rates in the United States will remain at current low levels for a long time to come. It should also be noted that financial incentives in the United States provide a flow of capital into commodity assets, and this implies a natural strengthening of commodity currencies against the US dollar, which we observe. Well, now it's time to analyze what is observed on the EUR/USD charts and try to find the most acceptable options for opening positions.
Daily
As already noted at the beginning of the article, the inability of the euro/dollar to go up to 1.2200, as well as to fall below 1.2000, leaves the main currency pair in this range. It should be noted that a very important role is played by the level of 1.2100, which is a kind of watershed in the range of 1.2000-1.2200. So at yesterday's trading, after falling to 1.2108, the pair turned up and, leaving a long tail at the bottom, ended trading on February 24 with a rise at 1.2163. In principle, yesterday's candle with a long lower shadow indicated that the market does not want to fall below 1.2100 and trade under this mark. After such candles as yesterday, the quote in the vast majority of cases continues to grow. This is exactly the picture that is observed now, at the moment of completion of this article. Currently, testing is underway for a breakdown of the strong resistance of sellers in the area of 1.2190. Today, we will see attempts to break through the key level of 1.2200, and the subsequent direction of the single European currency against the US dollar will largely depend on how successful they are.
H1
On the hourly chart, we see that the main currency pair is trading in an ascending channel, which indicates a local bullish trend for EUR/USD. I would like to draw your attention again to the significance of the average dotted line of the channels. In the current situation, when the pair is trading above the midline, it represents stylish support, as you can already see today. Given that, at the moment, there are attempts to break through strong resistance in the area of 1.2200, and also that tomorrow the market will close the February trades, it is quite difficult to find the safest options for opening positions. Nevertheless, I look at EUR/USD with a bullish view, and for those who agree with this point of view, I recommend looking for options for opening long positions after short-term declines to the price zone of 1.2185-1.2170. If today's trading ends with the formation of a bearish candlestick pattern on the daily chart, tomorrow we will consider options for opening short positions.
