4 hour timeframe
Technical details:
Senior linear regression channel: direction - sideways.
The younger linear regression channel: direction - up.
Moving average (20; smoothed) - up.
CCI: 82.8856
On Wednesday, June 19, the day ended with extremely important macroeconomic events. Firstly, it became known that the Fed's key rate remained unchanged at the level of 2.5%, as we expected. A little later, the press conference of Jerome Powell began. It should be noted right away that all of the conferences and covering letters of the Fed and its heads are similar to each other, especially in recent months. Powell said yesterday that the proposal to "cut the rate right now" did not find support among FOMC members, therefore, the Fed intends to respond to long-term trends in economic indicators and to several changes in them or changes in expectations. Moreover, it is very reasonable from our point of view. Furthermore, Powell said that the biggest source of uncertainty is the trade war with China and further development of the Fed will depend on its development. With regard to the deteriorating state of the labor market, the Fed chairman showed no concerns about this and we also believe that a one-time deterioration cannot be a basis for easing monetary policy. In general, we can conclude from Powell's speech: the economy remains at a stable level, threats of recession exist but they only loom somewhere on the horizon. The main danger is trade wars and there are no 3 rate reductions in 2019, possibly only one - and that is not a fact. Thus, we can regard the outcome of the Fed meeting even as hawkish. Unfortunately, traders began to get rid of the dollar long before the evening news, which led to the fall of the US currency by the end of the day. However, the absence of a pronounced "dovish" rhetoric from the Fed can bring the US dollar back to life in the coming days, but then the Fed chairman showed no concerns about this. We also believe that a one-time deterioration cannot be a basis for easing monetary policy. In general, we can conclude from Powell's speech: the economy remains at a stable level, threats of recession exist, but they only loom somewhere on the horizon, the main danger is trade wars, there are no 3 rate reductions in 2019, only one - and that is not a fact.
Nearest support levels:
S1 - 1.1230
S2 - 1,1200
S3 - 1.1169
Nearest resistance levels:
R1 - 1.1261
R2 - 1,1292
R3 - 1.1322
Trading recommendations:
The EUR/USD currency pair has started an upward movement, entrenched above the MA. Thus, cautious purchases of the euro/dollar pair are now recommended with targets at 1.1229 and 1.1322, before turning Heiken Ashi downward.
It is recommended to sell the Eurocurrency again after the traders fix the pair below the moving average line, which will change the downward trend with the first targets of 1.1200 and 1.1169.
In addition to the technical picture should also take into account the fundamental data and the time of their release.
Explanations for illustrations:
The older linear regression channel is the blue lines of unidirectional movement.
The younger linear regression channel is the violet lines of 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.
Heiken Ashi is an indicator that colors bars in blue or purple.
The material has been provided by InstaForex Company - www.instaforex.com