4-hour timeframe
The amplitude of the last 5 days (high-low): 47p - 58p - 29p - 24p - 46p.
Average amplitude for the last 5 days: 41p (40p).
The euro/dollar currency pair started a second round of upward correction on May 22 with a view to the Kijun-Sen line. The MACD indicator did not even have time to turn down, therefore, in general, the correctional mood among traders remains. As we expected in the morning, the head of the ECB, Mario Draghi, did not say anything important in his speech. This is evident even in the volatility of the EUR/USD pair, which remains low, only about 40 points a day. The publication of the minutes of the last Fed meeting is also scheduled for tonight. However, we believe that this document will also not contain any important and fundamentally new information. Recently, among traders, the topic of inflationary pressure on the US economy is often discussed. We believe that this topic does not deserve so much attention in the context of forecasting the movement of the euro/dollar. Inflation in recent months and years has been stable at about 2%, naturally, not without hesitation, but in general, the market's response to this indicator is present only on the days of the publication of inflation reports. In general, it cannot be said that inflation has a strong influence on monetary policy or its current value is causing great concern among traders and economists. In general, the US economy feels just fine, despite all the experts' concerns about recession, trade wars and the world community's disapproval over some of Donald Trump's actions. The US dollar is growing and growing, especially against European currencies. Thus, we believe that the in the evening, the "Fed minutes" is nothing more than a formality. In the end, traders are most interested in the information that may affect the dollar. The Fed is not going to reduce or raise the rate in the coming months. Stimulation of the economy is not required. Inflation is at a stable level, wages are rising, the labor market is in good condition.
Trading recommendations:
EUR/USD continues the correction. A new price rebound from the critical line may trigger the completion of the correction, and in this case it is recommended to sell the euro to the support level of 1,1124.
It is recommended to return to buying if the bulls manage to overcome the Kijun-sen line. In this case, the first target for buying the currency pair will be the level of 1.1206.
In addition to the technical picture also take into account the fundamental data and the time of their release.
Explanation of the illustration:
Ichimoku indicator:
Tenkan-sen - the red line.
Kijun-sen - the 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 Indicator:
Red line and histogram with white bars in the indicator window.
The material has been provided by InstaForex Company - www.instaforex.com