4-hour timeframe
Amplitude of the last 5 days (high-low): 73p - 78p - 90p - 121p - 70p.
The average amplitude for the last 5 days is 86n (83p).
On Thursday, August 23, the US dollar began to appreciate. On the one hand, this is quite a logical event, as the MACD indicator was already heavily overbought, and the technical correction itself was brewing. On the other hand, everyone is interested in the question of whether the weakening of the dollar will end on this? Logically, traders adjusted the pair quite strongly against the long-term growth of the US currency. Now you can start selling new couples. From a technical point of view, of course, it's better to wait for the price to be fixed below the critical Kijun-sen line, which will significantly increase the chances of continuing the downward movement. However, even the current correction can be fully worked out, and next to the Kijun-sen line look at the behavior of the pair. If the critical line is overcome, we leave the shorts open and build them up. From a fundamental point of view, the topic of the trade war between China and the US remains a key topic on the foreign exchange market. Right at the time of negotiations between the parties, reciprocal equal trade duties began to operate for 16 billion dollars from each side. The markets took this information negatively and started buying US currency. If the results of the talks are disappointing, then, most likely, this will cause even greater demand for the US dollar. Of macroeconomic reports, there is really nothing to highlight today. Today, a report will be published from the meeting on the monetary policy of the ECB, however, as in the Fed's report yesterday, it is unlikely that there will be extremely important information that the market will not be able to react to ...
Trading recommendations:
For the pair EUR / USD, correction began. Thus, now it is recommended to consider shorts in small lots with the aim of Kijun-sen line. In case of overcoming this line, the sell-positions can be increased with targets of about 1.1400.
Long positions can be opened if the MACD indicator turns up or the price bounces off the Kijun-sen line. In this case, the bulls will have a good opportunity to continue the uptrend with the target of 1.1632, which is recommended to be rejected.
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