4-hour timeframe
Technical details:
The senior linear regression channel: direction - up.
The junior linear regression channel: direction - down.
Moving average (20; smoothed) - up.
CCI: 8.5358
The last day ended with a rather unexpected decline of the EUR / USD pair to a moving average line. Unexpected, because before that, the trades were quiet low-volatility. Nevertheless, from the technical side, nothing supernatural happened. The pair has corrected, perhaps, before resuming the uptrend. If you look at the chart carefully, it becomes clear that the pair had difficulties in the past, overcoming the area of 1.1480 - 1.1510. Three and four times the pair turned around it. Therefore, the current downward reversal is absolutely logical, and a higher probability of overcoming the MA and a further decline in the area of 1.1290 - 1.1310. Today, February 1, in the European Union, it is planned to publish a preliminary inflation value for January. This report will not have a strong influence on the movement of the pair, however, it will reflect the trend, and it is already negative. The next slowdown in inflation is expected to 1.4%. In the States today, an important report on NonFarm Payrolls, as well as the unemployment rate, the index of business activity in the field of production of ISM and the change in average hourly wages will be released. This macroeconomic data package can have a strong impact on the pair, and if it does not fail, the US dollar will receive the necessary support.
Nearest support levels:
S1 - 1.1414
S2 - 1.1353
S3 - 1.1292
Nearest resistance levels:
R1 - 1.1475
R2 - 1.1536
R3 - 1.1597
Trading recommendations:
The currency pair EUR / USD has begun to adjust. New longs are recommended to open in case of a price rebound from the moving average line with the first target of 1.1475. The Heikin Ashi indicator can confirm the completion of the correction round.
It is recommended to open a sell position if traders overcome a moving average line and, preferably, a level of 1.1414 with a target of 1.1353. Today's reports in the States could trigger a boom in US currency.
In addition to the technical picture should also take into account 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