4-hour timeframe
Technical details:
The senior linear regression channel: direction - up.
The younger linear regression channel: direction - up.
Moving average (20; smoothed) - down.
CCI: -106.0778
The currency pair EUR / USD on Friday, January 18, continues a very weak downward movement, which by its nature borders on the side. But still, a small downward slope is present. Instrument volatility has dropped to lows, which is even a bit surprising since there was no reason for such a drop in activity. The important news coming from the UK, although they do not have a strong influence on the euro, still clearly could not contribute to a drop in volatility. In general, it seems that the current situation for the pair is a consequence of some uncertainty among traders in the question: how to trade further? A further decline in the euro will lead to an update of the lows, of which there were four and all of them are clearly visible on the chart. Updating the lows will lead to a breakdown of the technical picture and the possible resumption of the downtrend, for which there are no fundamental grounds now. In this situation, it is best to wait for the pair to exit the low volatility zone. Unfortunately, no important macroeconomic publications have been planned either in the States or in the EU. Thus, today we can hardly expect an increase in activity. Nevertheless, there is always the likelihood of unexpected information entering the markets.
Nearest support levels:
S1 - 1.1353
S2 - 1.1292
S3 - 1.1230
Nearest resistance levels:
R1 - 1.1414
R2 - 1.1475
R3 - 1.1536
Trading recommendations:
The currency pair EUR / USD continues the weakest movement down. Therefore, it is still recommended to trade short positions with the first goal of 1.1353. Heikin Ashi's upward reversal will serve as a signal to manually reduce short positions.
Long positions are recommended to open with the target of 1.1475 if the pair consolidates above the moving average. In the coming days, the pair may remain in the area of weak volatility and the absence of a pronounced trend, so for some time, you can be out of the market.
In addition to the technical picture, you should also consider the fundamental data and the time of their release.
Explanations for illustrations:
The senior linear regression channel is the blue lines of the unidirectional movement.
The younger linear regression channel is the purple lines of the unidirectional movement.
CCI - blue line in the indicator window.
The moving average (20; smoothed) is the blue line on the price chart.
Murray levels - multi-colored horizontal stripes.
Heikin Ashi is an indicator that colors bars in blue or purple.
The material has been provided by InstaForex Company - www.instaforex.com