4-hour timeframe
The amplitude of the last 5 days (high-low): 61p - 44p - 44p - 40p - 28p.
Average amplitude for the last 5 days: 43p (49p).
On Wednesday, March 20, the EUR/USD currency pair continued to amaze with its stability. For more than ten consecutive days, the pair has been showing daily moderate growth with low volatility. Moreover, low volatility values continue to decline. For example, the pair went through a "whole" 28 points for the entire day on Tuesday. There is a hope that tonight after the results of the Fed meeting will be announced, volatility will increase. However, we believe that if no "loud" statements are made, then market reaction might simply not follow. And what loud statements can the Fed make? traders have already realized the fact that there are risks of a slowdown in the US economy. The Fed might not tighten monetary policy this year too. The fact that the Fed can stop unloading its balance has also been known for a long time. What else? Nothing else. The only thing is that the Fed can once again shift the attention of traders on the rejection of the rate hike plan, which implies two increases in 2019. Therefore, we believe that the reaction of market participants to the Fed meeting will be more than restrained. It should also be taken into account that in any case, the effect of the Fed's decisions may persist until tomorrow's US trading session, since European markets are already closed during the announcement of the results of the meeting. From a technical point of view, the uptrend continues, and the MACD indicator has started to discharge, as it reacts poorly to low price increases and low volatility. Thus, the key indicator for determining the trend now is the ichimoku and its Kijun-Sen line.
Trading recommendations:
The EUR/USD continues to move up. Thus, it is recommended that you consider the longs with targets of 1,1372 and 1,1403, since the initiative for the instrument remains in the hands of the bulls. During the announcement of the results of the Fed meeting, it is recommended that you use Stop Loss orders or exit the market.
Shorts are recommended to be considered if traders manage to gain a foothold below the critical line. In this case, the trend will change to a downward one, and the first target will be the support level of 1.1250.
In addition to the technical picture should also take into account the fundamental data and the time of their release.
Explanation of illustration:
Ichimoku Indicator:
Tenkan-sen-red line.
Kijun-sen – blue line.
Senkou span a – light brown dotted line.
Senkou span B – light purple dotted line.
Chikou span – green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD:
A red line and a histogram with white bars in the indicator window.
The material has been provided by InstaForex Company - www.instaforex.com