EUR/USD – 1H.
During the last trading day, the EUR/USD pair rebounded from the corrective level of 161.8% (1.2166), turned in favor of the US dollar, and began the process of falling towards the levels of 1.2117 and 1.2068. Thus, traders quickly moved away from Friday's shock when the Nonfarm Payrolls report was significantly weaker than the traders' expectations. Despite this weakness in the report, 1.5 million jobs have been created in America since January 20, 2020. US President Joe Biden stated it. He noted that this is the largest number of new jobs in the first 100 days of work among all US presidents. Joe Biden also said that the country's economy grew by 6.4% in the first quarter, far outpacing the growth of the European Union.
Joe Biden said that the $ 1.9 trillion bailout plan is helping the US economy recover faster, and in the coming months, growth will be the strongest in 40 years. So far, the weak Nonfarm last Friday can be attributed to chance. Although Fed President Jerome Powell has repeatedly said that the US economy is recovering quickly, it still needs to be stimulated and supported. Also, according to Powell, much will depend on the further development of the coronavirus pandemic around the world. According to the head of the Federal Reserve, the US economy will not be able to fully recover if the epidemic continues to rage among the largest US trading partners and quarantine restrictions are in effect. However, for the US currency, all this is now unimportant. Graphic pictures show that the US currency has started a new decline. Therefore, we need specific reasons for bull traders to retreat from the market.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes continue to grow in the direction of the level of 1.2223. The rebound of the exchange rate from this level will work in favor of the US currency, and some fall in the direction of the Fibo level of 161.8% (1.2027). The consolidation of quotes above 1.2223 will increase the probability of continuing growth in the direction of the corrective level of 200.0% (1.2353). There are no emerging divergences in any indicator today.
EUR/USD – Daily.
On the daily chart, the EUR/USD pair quotes closed above the level of 161.8% (1.2027). Upward trends are now resumed on all charts. On the daily chart, the target is the corrective level of 200.0% (1.2356).
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair performed a consolidation above the "narrowing triangle," which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On May 10, the calendars of economic events in the European Union and the United States were empty, so there was no information background on this day for the euro/dollar pair.
News calendar for the United States and the European Union:
On May 11, the calendars of the European Union and the United States are again empty, so today, the information background will be absent for the euro/dollar pair.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which again showed that speculators actively increased both long contracts and short in the reporting week. The first number increased by 7,033 contracts, and the second – by 6,148. Thus, almost complete equality. In general, the number of long contracts focused on the hands of the "Non-commercial" category still exceeds the number of short contracts by almost two times. That is, the mood of speculators remains "bullish," which is confirmed by the movement of the euro/dollar pair itself, which has resumed upward trends on all charts. For other categories, the changes are minimal.
EUR/USD forecast and recommendations for traders:
I recommended selling the pair if there is a rebound from the Fibo level of 161.8% (1.2166) on the hourly chart. Now, these positions should be supported with a target of 1.2117 (and 1.2068). I recommend buying the pair today if the hourly chart closes above the level of 1.2166 with a target of 1.2223.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency, not for speculative profit, but to support current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
