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4-hour timeframe
Amplitude of the last 5 days (high-low): 41p - 57p - 55p - 94p - 148p.
The average amplitude for the last 5 days is 79n (60p).
Once again, there is no important macroeconomic report published in the euro area or the United States. These reports, which traders still do not pay attention to, are not needed. On Monday, August 13, the long-awaited correction of the European currency against the US dollar began. However already now many experts consider that the euro will continue to fall. This time, the reason could be the introduction of duties on imports of steel and aluminum from Turkey to the States. The Turkish lira has already lost more than 11% against the US currency. And since the Turkish economy is strongly connected with the banking sector in Europe, there is every reason to believe that a financial crisis in Europe may break out, which will affect Europe. Thus, taking into account new developments, we would like to note once again that the talks around the possible tightening of the ECB monetary policy, can soon come to nothing. Recall that the head of the ECB reported on maintaining the key rate until the summer of 2019, and the quantitative incentive program should end in late 2018. However, these plans may not be implemented now. Everything will depend on how the trade war with Turkey will affect the euro area, which just sighed calmly, having found a compromise with Donald Trump. Thus, in the coming days, the Euro-currency may resume its decline.
One of the key factors in the growth of the US dollar is also the desire of traders to invest precisely in this currency on the background of the fact that it is the US that introduces trade sanctions against whom it can, which is interpreted as the strength of Trump, the country, and the economy. The head of the ECB reported on maintaining the key rate until the summer of 2019, and the quantitative incentive program should end in late 2018. However, these plans may not be implemented. Everything will depend on how the trade war with Turkey will affect the euro area, which just sighed calmly, having found a compromise with Donald Trump. Thus, in the coming days, the Euro-currency may resume its decline.
Trading recommendations:
On the EUR / USD pair, an upward correction began. Thus, small lots can be bargained for 1.1500, but this should be done very carefully. Turning the MACD indicator down can signal the completion of the correction.
It is recommended to consider short positions after the completion of the current correction with a target level of 1.1344. The completion of the correction can be determined by turning the MACD down or by rebounding the price from the critical Kijun-sen line.
In addition to the technical aspect, one should also take into account the fundamental data and the time of their release.
Explanations to the illustration:
Ichimoku Indicator:
Tenkan-sen is a red line.
Kijun-sen is a blue line.
Senkou Span A is a light brown dotted line.
Senkou Span B - a light purple dotted line.
Chikou Span is a green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD indicator:
Red line and histogram with white bars in the indicator window.InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.
