EUR/USD – 1H.
During the last trading day, the EUR/USD pair rebounded from the corrective level of 161.8% (1.2166), turned in favor of the European currency, and began a new growth process in the direction of the level of 1.2238, from which it had previously fought off twice. In general, the movement of the last few days has somehow imperceptibly moved into a side corridor, which is just limited to the levels of 1.2166 and 1.2238. It turns out that today is the sixth day in a row when the price is between these levels. Thus, the rebound of quotes from the level of 1.2238 will allow traders to count on a reversal in favor of the American, and some fall in the direction of the lower border of the corridor. Closing the rate above the level of 1.2238 will increase the probability of further growth in the direction of the next Fibo level of 200.0% (1.2275).
Although the information background was present for the euro/dollar pair last week, the pair is trading in a sideways corridor. Moreover, this corridor was formed right near the maximum marks of the course in recent times. The bull traders do not let the pair below the level of 1.2166 and just wait for their chance. Last week, the Fed and Christine Lagarde twice prevented bull traders from continuing to grow. But, as we can see, no drop in quotes has begun. The upward trend corridor still characterizes the current mood of traders as "bullish", and there are no prerequisites for its change to "bearish". There was no major news or reports in the European Union and the US yesterday. Today, the picture is the same. Thus, there is a high probability that today the pair will still stay one day inside the side corridor. There are very few economic reports and other events this week. However, I believe that this factor will not be a hindrance for bull traders.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes performed a new rebound from the level of 1.2223. However, it did not fall even to the trend line and has already performed a return back to this level. A new rebound from this level will again allow you to count on a slight drop in quotes. However, it is better now to track these rebounds on the hourly chart, where there is a pronounced side corridor. Closing the pair's rate under the trend line will significantly increase the chances of a strong fall in the direction of the Fibo level of 161.8% (1.2027).
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair closed above the level of 161.8% (1.2027), which allows us to expect continued growth in the direction of the corrective level of 200.0% (1.2356). Upward trends continue on all charts now.
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair has made a consolidation above the "narrowing triangle", which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On May 24, the calendars of economic events in the European Union and the United States did not contain any interesting entries. The information background was absent on Monday.
News calendar for the United States and the European Union:
US - consumer confidence indicator (14:00 UTC).
On May 25, the calendars of economic events in the European Union and America are again almost empty. In America, the consumer confidence indicator will be released. However, it is unlikely that traders will pay attention to it.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which showed not only a new strengthening of the "bullish" mood of speculators but also a sharp increase in the interest of all categories of traders in contracts for the euro currency. The "Non-commercial" category of traders opened 10,696 long contracts and a total of 1,588 short contracts during the reporting week. Thus, speculators continue to increase the number of purchases. Therefore, they continue to believe in the European currency, whatever the information background from the European Union. I also note that in the reporting week, the total number of open contracts increased sharply – by almost 67 thousand. The interest of all market players is growing in the euro currency.
EUR/USD forecast and recommendations for traders:
I recommend selling the pair when closing under the trend line on the 4-hour chart with the targets of 1.2068 and 1.1990. Purchases of the pair were again recommended when rebounding from the level of 1.2166 on the hourly chart with targets of 1.2238 and 1.2275. Now, these positions should be kept open until they rebound from any level.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency, not for speculative profit, but to support current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
