To open long positions on EURUSD, you need:
Given the low volatility of the market, we did not reach the levels I indicated this morning. But given that the bulls failed to offer anything during the European session, everything points to a possible formation of a downward correction of the euro. Most likely, the focus will be shifted to the second half of the day, when data on the US economy will be released.
For the second half of the day, the technical picture has not changed in any way. Only weak data on the income and expenses of Americans will try to shake the market somehow. The initial task of buyers will be to form a false breakdown in the support area of 1.1920, which will form a signal to open long positions in the expectation of further growth of EUR/USD in the resistance area of 1.1961, above which it was not possible to break through yesterday. A breakout and a test of this level from top to bottom can form an additional signal to open long positions to restore the pair to a larger resistance of 1.2000, where I recommend fixing the profits. The next target will be the 1.2032 area. In case of weak activity of buyers in the area of 1.1920, it is best not to rush with purchases. I recommend waiting for the support update 1.1884. You can buy EUR/USD immediately for a rebound only from the minimum of 1.1852, counting on an upward correction of 15-20 points within the day.
To open short positions on EURUSD, you need:
The economic bulletin from the European Central Bank did not affect the market in any way, as did the lending data, which leaves the bears a chance to build a downward correction. An important task for sellers for the second half of the day remains the breakthrough of the support of 1.1920, which they fought yesterday throughout all trading sessions. Strong data on the US economy will lead to a breakdown and a test of the 1.1920 area from the bottom up, which will form an excellent signal to open short positions with the aim of further falling EUR/USD to the lows of 1.1884 and 1.1852. If the euro rises during the US session, an equally important task for sellers will be to protect the resistance of 1.1961. The formation of a false breakout will be the entry point to short positions in the euro. If there is no activity of sellers there today, I recommend postponing short positions until the 1.2000 resistance test, where you can immediately sell the pair for a rebound based on a downward correction of 15-20 points. The next major resistance for sale is at the maximum of 1.2032.
Let me remind you that there were significant changes in the COT report (Commitment of Traders) for June 15. Both short and long positions were sharply reduced. However, the data do not consider the Federal Reserve's decision on interest rates, so I do not recommend placing much emphasis on these indicators now. Let me remind you that last week the euro resumed its major fall against the US dollar after the first hints of the Fed on an earlier increase in interest rates in 2023. It also suggests that the central bank may soon begin to wind down its bond-buying program, which will strengthen the US dollar's position on the world stage even more. The inflation data that has recently been released for the US and the eurozone suggests that the European Central Bank will not rush to make changes in its policy yet, weakening the euro's position. Most likely, the trend for the strengthening of the US dollar will continue this week. The COT report indicates that long non-commercial positions fell from the level of 232,103 to 210,816, while short non-commercial positions fell from the level of 124,890 to the level of 92,630. It should be understood that the lower the European currency falls, the more interest it will arouse among traders since the eurozone economy is aimed at strong growth in the summer, which will necessarily affect the prospects for its recovery after the coronavirus pandemic. The total non-commercial net position increased from the level of 107,213 to the level of 118,186. The weekly closing price fell from the level of 1.2190 to the level of 1.2121.
Signals of indicators:
Moving averages
Trading is conducted around 30 and 50 daily moving averages, indicating further market uncertainty with the direction.
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 volatility is very low, which does not give signals to enter the market.
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
- Non-profit speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet specific requirements.
- Long non-commercial positions represent the total long open position of non-commercial traders.
- Short non-commercial positions represent the total short open position of non-commercial traders.
- Total non-commercial net position is the difference between the short and long positions of non-commercial traders.
