EUR/USD – 1H.
On Friday, the EUR/USD pair performed a new fall to the corrective level of 100.0% (1.1704), rebounding from it and turning in favor of the European currency. The downward trend corridor continues to characterize the current mood of traders as "bearish". Thus, the growth process can begin in the direction of its upper limit. The consolidation of quotes under the level of 100.0% will work in favor of the US dollar and the resumption of the fall in the direction of the level of 1.1629. On Friday, the information background was practically absent. On this day, there were speeches by Jerome Powell, Richard Clarida, and Michelle Bowman. However, they did not report anything interesting and important for traders. Jerome Powell spoke earlier last week, right after the Fed meeting. Traders received all the necessary information, so few people expected anything new from the Fed president on Friday.
Now one thing is clear – at least until November, the stimulus program in the United States will continue to operate in the same volumes. It is difficult to draw an unambiguous conclusion in this regard. The US dollar has been continuing the growth process for several weeks, but at the same time, the scale of its strengthening cannot be called serious. On the 4-hour (or higher) chart, traders may notice that the pair's quotes continue to be between the levels of 1.1704 and 1.2350 all this time (in recent months). There seems to be a bearish bias, but it is not global. Today, the president of the European Central Bank, Christine Lagarde, will make a speech, as well as several members of the Fed board, in particular John William, Charles Evans, and Lael Brainard. However, I also do not expect any important information from them. It is now extremely important for the euro/dollar to maintain a "bearish" momentum if bear traders are counting on something more serious than a simple fall to 1.1704 for the third or fourth time. Thus, the dollar needs support.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes closed under the corrective level of 76.4% (1.1782). Thus, the process of falling quotes can be continued in the direction of the next corrective level of 100.0% (1.1606). Bullish divergence allowed the quotes to start a slight growth process, but a rebound from the level of 76.4% will work in favor of the US currency once again.
News calendar for the US and the European Union:
EU - ECB President Christine Lagarde will make a speech (11:45 UTC).
US - FOMC member Charles Evans will deliver a speech (12:00 UTC).
US - FOMC member John Williams will deliver a speech (13:00 UTC).
US - FOMC member Lael Brainard will give a speech (16:50 UTC).
On September 27, the calendar of economic events of the European Union contains a speech by Christine Lagarde. In the United States - nothing that would catch your eye. Thus, today, the only hope is for Lagarde, although I do not expect much from her speech. The information background will be weak today.
COT (Commitments of Traders) report:
The latest COT report showed that during the reporting week, the mood of the "Non-commercial" category of traders changed very seriously. Speculators opened 550 long contracts on the euro and 18,550 short contracts. Thus, the total number of long contracts in the hands of speculators has grown to 188 thousand, and the total number of short contracts - to 178 thousand. Over the past few months, the "Non-commercial" category of traders has been actively getting rid of long contracts on the euro and increasing short. This process continues even now. However, at the same time, the euro showed a very weak drop over this time. Thus, the euro again gets a good chance of continuing to fall, but bear traders still cannot close below the level of 1.1704.
EUR/USD forecast and recommendations for traders:
I recommended buying the pair when closing quotes above the Fibo level of 100.0% (1.1704) on the hourly chart with a target of 1.1772. Now, these transactions can be closed in profit or wait for growth to 1.1772. I recommend selling if there is a close below the level of 1.1704 on the hourly chart, with the target of the level of 1.1629.
"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 ensure current activities or export-import operations.
"Non-reportable positions" are small traders who do not have a significant impact on the price.