EUR/USD - 4 H.
On October 4, the EUR/USD pair performed a return to the correction level of 100.0% - 1.1106 on the 4-hour chart, and rebounded from it; however, it could not resume the process of falling. At the moment, the euro-dollar pair has completed a return to this Fibo level again and is threatening to close it. If this happens, then I will state the reversal of the pair's quotes in favor of the European currency and expect some growth in the direction of the level of 1.1164, to which the pair has already approached twice. In addition, another rebound from the correction level of 100.0% will work again in favor of the US dollar.
Information background:
If you start the countdown from Monday last week, then only one day out of all the workers was really interesting in terms of news. All other days can be safely identified as half-days, as no economic reports were published. Nevertheless, the head of the European Central Bank, Mario Draghi, delivered a speech twice (once just last Thursday), both times his speech could not be called positive for the European currency, and his last speech was frankly just a farewell. This Thursday, Christine Lagarde will officially take over his post, and the ECB will turn over a page dedicated to the 8-year reign of Mario Draghi. But all this time, the Euro currency practically didn't respond at all, since most of the traders took their places "on the fence" and were waiting for news, and the news will only be tomorrow. However, today at the American session, signs of growth of the Euro currency were noticed, although there seemed to be no reason for this. On the other hand, a day before the Fed summarizes the results of the meeting, a dollar fall is a sign that traders believe in a third consecutive rate reduction and begin to get rid of the US currency. Burning, by the way, is not too strong. As a result, a day before the most important event of October, we have a rather blurry situation.
If we take into account the worsening economic statistics in the US - the Fed has reason to weaken monetary policy. If you take into account the ongoing trade war with China - the Fed has reason to lower rates. If you take into account the ongoing criticism of Jerome Powell by Donald Trump - the Fed has reason to weaken monetary control. Thus, traders are not in vain expecting a decrease in rates by another 0.25%. What will be the reaction of traders to this event? It is unlikely that the US dollar will fall too much, yet many forecasters predict this decision by the Fed, it will not come as a surprise.
What to expect today from the euro-dollar currency pair?
October 29, traders, most likely, will relatively calmly bring the day to an end, and the most interesting event will be tomorrow. If the euro-dollar pair closes above the correction level of 100.0% - 1.1106, I will expect continued growth of the pair. Meanwhile, weak GDP data in America, Fed rate cuts, a portion of dovish comments from Jerome Powell - all of these will support bull traders in their desire to buy European currency.
The Fibo grid was built at the extremes of May 23, 2019 and June 25, 2019.
Forecast on EUR/USD and recommendations to traders:
I recommend selling the pair with a target of 1.1024 if a new rebound from the level of 1.1106 (100.0% Fibonacci) is performed. Stop Loss - Above 1.1106.
I recommend buying a pair with targets 1.1164 and 1.1232 and Stop Loss level at 1.1106, if closing is performed above the Fibo level of 100.0%.
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