Following the trading results on July 19-23, all major currencies, except for the Canadian dollar, declined against the US dollar. With a high degree of probability, it can be assumed that such a course of trading was influenced by the spread and surge in the number of people infected with the COVID-19 delta strain. In other words, investors' appetite for risk was spoiled, and they preferred to go to a quiet haven. As before, in such cases, it is the US dollar that becomes especially in demand. In general, it is worth noting that last week there was an ambiguous attitude to risky operations, the appetite for which sometimes arose, then was completely absent. If we return to the main currency pair of the Forex market, the single European currency declined against the US dollar by 0.24%.

However, some trading participants continue to expect signals from the Federal Reserve System (FRS) about earlier terms of tightening monetary policy. This Wednesday will be an excellent opportunity to verify the plans of the American regulator once again. The Fed will announce its decision on interest rates, publish an accompanying statement with updated economic forecasts, after which Federal Reserve Chairman Jerome Powell will hold his press conference. Without a doubt, this event can be considered the main one this week. Well, it's time for us to move on to the consideration of price charts, and let's start with the results of the weekly trading that ended on Friday.

Weekly

As can be seen on the weekly chart, the euro/dollar is still trading within the Ichimoku indicator cloud, the exit from which can determine the further direction of the quote, possibly in the medium term. It is worth noting that the exit from the cloud up is reliably guarded by the 50 simple moving average, the blue Kijun line, and the red Tenkan line of the Ichimoku indicator. The nearest support is 1.1730-1.1700, where there are 89 EMA and March lows at 1.1703. If the mark of 1.1700 is truly broken, the pair will fall to the area of 1.1615-1.1600, where the orange 200 EMA lies and the significant level of 1.1600 for the market. These are the immediate prospects for EUR/USD, judging by the weekly timeframe.

Daily

But on the daily chart, there is a slightly different picture. The pair started consolidating in a relatively narrow trading range of 1.1900-1.1752. It is likely that until the Fed's decision on rates and the press conference of the head of this department, Jerome Powell, EUR/USD will remain in the designated range. However, the market has been moving for quite a long time, without waiting for important events. Euro bulls need a breakdown of the red Tenkan line with mandatory consolidation above to strengthen their positions. However, this is unlikely to be enough to determine the bull market for EUR/USD. A little higher, near the strong technical level of 1.1860, is the blue Kijun line, which can stop the possible growth and turn the course in the south direction.

Trading recommendations for EUR/USD:

In my personal opinion, the pair has more prerequisites for a decline, which means that selling the euro/dollar is a higher priority. I suggest looking for options for opening short positions after short-term rises in the price zone of 1.1800-1.1850 and the appearance of bearish candlestick analysis models there at this or smaller time intervals. The same strategy is also appropriate for purchases after a decline to 1.1700 and the appearance of bullish candle patterns on smaller charts.