To open long positions on EUR/USD, you need:

No signals to enter the market yesterday morning, which cannot be said about the US session, in which we formed a good entry into short positions. Although the deal turned out to be unprofitable, whoever sold from the 1.1749 level did the right thing. The market just didn't go in the right direction. Let's take a look at the 5-minute chart. It shows how the bears achieved a breakout of 1.1749 and then, after a while, tested this level from the bottom up, forming a good entry point for short positions. But it did not fall.

The technical picture has changed at the moment. Buyers of the euro are focused on resistance at 1.1783, consolidation at which forms a good entry point to long positions while expecting to update weekly highs and to test the 1.1828 level, where I recommend taking profits. Going above 1.1828, without the necessary fundamental support, which we do not have today, will be very problematic. However, if this can be done, we can expect an update to the high of 1.1868, where buyers will stop. In case EUR/USD falls, I recommend opening new long positions only after forming a false breakout in the support area of 1.1737, or immediately on a rebound from the low of 1.1688, counting on a correction of 20-30 points within the day.

The Commitment of Traders (COT) report for September 29 recorded a reduction in both long and short positions, which led to a decrease in the delta. Apparently, the lack of guidelines and a surge in the incidence of coronavirus in Europe discouraged major players from building up long positions in the euro, but no one is in a hurry to buy the US dollar either because of the upcoming presidential elections in the United States. Thus, long non-commercial positions decreased from 247,049 to 241,967, while short non-commercial positions decreased from 56,227 to 53,851. The total non-commercial net position also decreased to 188,116, against 190,822 a week earlier. which implies that new players are taking a wait-and-see approach, however, bullish sentiments for the euro remain rather high in the medium term. The more the euro falls against the US dollar, the more attractive it is for new investors.

To open short positions on EUR/USD, you need:

Sellers need to defend resistance at 1.1783, forming a false breakout at this level will allow us to build up short positions, counting on the pair to repeatedly fall to the new support area at 1.1737, where I recommend taking profits. In case bulls are not active at this level, it is possible to increase short positions, but only after the bears achieve consolidation below this range, which will open a direct path to the low of 1.1688. If the bulls manage to climb the resistance of 1.1783 in the first half of the day, then in this scenario it is best not to rush to sell, but to wait until a high of 1.1828 has been updated and open short positions from there immediately on a rebound, counting on a correction of 20-30 points within the day.

Indicator signals:

Moving averages

Trading is carried out in the area of 30 and 50 moving averages, which indicates market uncertainty with the succeeding direction.

Note: The period and prices of moving averages are considered by the author on the H1 hourly chart and differs from the general definition of the classic daily moving averages on the daily D1 chart.

Bollinger Bands

A breakout of the upper border of the indicator in the 1.1775 area will lead to a new wave of euro growth. A breakout of the lower border of the indicator around 1.1745 will increase the pressure on the pair.

Description of indicators

• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
• MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between short and long positions of non-commercial traders.