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EUR/USD – 4H.
As seen on the 4-hour chart, the EUR/USD pair resumed the process of falling and performed consolidation under the Fibo level of 50.0% (1.1029). However, a new bullish divergence has already formed in the MACD indicator, which allows traders to count on a new reversal in favor of the European currency and some growth in the direction of the correction level of 50.0%. The downward trend channel remains in force, at the same time, it hints at a possible growth, as at the moment, the pair's quotes are moving along its lower line. The rebound of the pair from the Fibo level of 61.8% (1.0995) can similarly lead to some growth of the pair.
Although there were again no economic reports on Tuesday in either America or Europe, one event nevertheless occurred that requires careful consideration. This event is Donald Trump's speech at the New York Economic Club. Trump would not be Trump if he told the audience that "everything is good", and the government is working harmoniously and trying to achieve its goals. Of course, that didn't happen. The US president immediately attacked the previous administration, accusing it of improper taxation, which is not in the interests of the middle class, and the conclusion of unprofitable international agreements. But Donald Trump spoke very flatteringly about his work, saying that during his presidency, more than 7 million jobs were created. According to Trump, "by creating jobs, we are transforming people's lives." Trump also believes that in recent years, the number of poor people in America has decreased significantly. Well, the labor market, according to the American President, is the most important vector of development of the country. Trump urged American companies to hire primarily American citizens and not to move production abroad. And of course, Trump could not ignore the topic of the trade conflict with China. According to the US leader, China has been stealing intellectual property from America for many years, but he does not blame Beijing, but previous administrations that allowed China to carry out such activities.
It is worth noting that the euro/dollar currency pair did not show any reaction to this speech of Trump and is waiting for today's report on inflation in the United States. I believe that Trump began to act in the context of future elections, praising himself as often as possible, and criticizing everyone else as much as possible. Under Donald Trump, unemployment fell to record lows, and the stock market rose to record highs. However, the activities of any president have both bright and dark sides. It is unlikely that anyone will agree that the trade war with China has brought positive results and was generally worth starting. It is unlikely that American manufacturers will agree with Trump that the plants should be returned to the territory of the United States, where much higher taxes are in force and labor costs much more than in China itself.
Forecast for GBP/USD and trading recommendations:
On November 13, traders are likely to start working out a new bullish divergence in the MACD indicator and move the pair up a little. At the same time, I do not expect strong growth in the euro currency, although there will be a lot of interesting economic reports today. Inflation in Germany has already come out but fully coincided with traders' expectations, remaining at the level of 1.1% y/y. I recommend selling the pair now in the case of closing under the Fibo level of 61.8% with a target of 1.0952. Today, traders will get acquainted with the report on inflation in the United States, and to witness the speech of Fed Chairman Jerome Powell in the evening.
The Fibo grid is based on the extremes of October 1, 2019, and October 21, 2019.
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