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The amplitude of the last 5 days(high-low): 59p – 60p – 68p – 47p – 38p.
The average amplitude over the last 5 days: 54p (61p).
On Tuesday, August 20, the EUR/USD pair failed to update the local lows, which is good news for the European currency. No important and significant macroeconomic reports in the European Union and the States have been published today. Thus, traders of the foreign exchange market were on a "starvation ration" today. However, even on the day when no macroeconomic publications were planned, the euro "caught" the negative. It's all about Donald Trump, who simply cannot safely conduct international trade. At first, China was accused of "unfair treatment of America", which resulted in a full-scale trade war for it. Then the same accusation was made against the European Union. It seems that it is quite difficult to fight on two fronts and Trump decided to postpone the introduction of duties on the products of the EU engineering industry until November. However, Trump said yesterday that the European Union is even worse than China, implying that Brussels has introduced too high taxes, duties, and tariffs on American imports while imports of European products to the United States exceed exports by 83 billion dollars. According to Trump, this is the injustice and it seems that in November, duties will be imposed against the European Union. If China's duties are an unpleasant event, but the economy of a huge country can freely wait out the period until the next election in America, hoping that the new president will not be Trump, then for the EU economy, Trump's duties can become a few nails in the coffin. The ECB is already thinking about lowering rates despite the fact that they are negative, as well as the resuscitation of the quantitative easing program. If there is a trade war with the States, all indicators, GDP, inflation, industrial production, will collapse down. Given the fact that these figures are still showing a negative trend, the situation may become much worse by November. Well, the euro can easily fall to parity with the US dollar under the new Trump's indignation that the European Union specifically lowers the euro, and Jerome Powell does not want to cut rates so that the US dollar does not go up.
Trading recommendations:
The EUR/USD pair continues to move down. Thus, it is recommended to continue trading on the fall of the euro/dollar pair with a target of 1.1027. The bearish mood in the market remains, but the reversal of the MACD indicator upward will indicate the turn of the corrective movement. Buying the euro is now impractical, there are no signs of completion of the downward trend.
In addition to the technical picture, fundamental data and the time of their release should also be taken into account.
Explanation of illustration:
Ichimoku Indicator:
Tenkan-Sen – red line.
Kijun-Sen – blue line.
Senkou Span A – light brown dotted line.
Senkou Span B – light purple dotted line.
Chinkou Span – green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD Indicator:
A red line and a histogram with white bars in the indicator window.
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