4-hour timeframe
Amplitude of the last 5 days (high-low): 70p - 88p - 58p - 73p - 92p.
The average amplitude for the last 5 days: 76p (68p).
The EUR/USD currency pair fell down in the second half of last day. There were no significant reasons for this since no new reports from Trump or important macroeconomic reports were available to traders. Nevertheless, it seems that traders decided to return in buying the US dollar, despite the fact that the US president is doing everything to lower the investment attractiveness of the States in the eyes of international investors. A new package of sanctions against China for a total of $ 200 billion can be introduced after 2 months. During this time, Trump will wait for a response. If China introduces reciprocal trade duties, the US leader will prepare a new package of trade restrictions. There is also the option that the parties will still sit at the negotiating table, but now it seems extremely unlikely.
Yesterday ECB President Mario Draghi also delivered a speech. However, in his speech, he did not touch upon the issues of monetary policy, so there was no special reaction from traders. Thus, the main and almost the only topic that now worries traders is the trade war between the States and partners. And the most interesting thing is that market participants still believe that the trade conflict is in the hands of the United States. At least, this is very eloquently displayed on the chart movement of the major currency pair. Of course, we can say that the reasons for the growth of the dollar are the weakness of the EU economy. However, the EU economy has been in a more deplorable state for many years than the US economy. Based on this, we can conclude that the reason lies not in this. Technically, the volatility of the pair rose to 90 points yesterday, a new "dead cross" was formed. The goal of the previous day was perfectly worked out.
Trading recommendations:
For the EUR / USD pair, the correction turned into a downward movement. Thus, now it is recommended to consider shorts for the purpose of 1.1633. The signal to manually close positions will be the upward turn of the MACD indicator.
It is recommended to open purchase orders with small intraday lots if the MACD indicator turns up. In this case, the goal will be the critical Kijun-sen line. There is still no question of resuming the upward trend.
In addition to the technical picture, one should also take into account the fundamental data and the time of their release.
Explanations to the illustration:
Ichimoku Indicator:
Tenkan-sen is a red line.
Kijun-sen is a blue line.
Senkou Span A is a light brown dotted line.
Senkou Span B - a light purple dotted line.
Chinkou Span is a green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD indicator:
Red line and histogram with white bars in the indicator window.The material has been provided by InstaForex Company - www.instaforex.com