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EUR/USD – 1H.
Hello, traders! The euro/dollar pair continues to trade above the upward trend line. Thus, the mood of most traders is still characterized as "bullish". Yesterday, the pair's quotes made two attempts to close under the trend line at once. However, both ended in failure. Nevertheless, the very fact that the pair after April 9 can not really continue the growth process and frequent tests of the trend line is alarming. Fixing the pair's exchange rate under the trend line will work in favor of the US dollar and start a drop in quotes. There is absolutely nothing to note from the news on the first day of the week. On April 13, the news calendar was simply empty, and the Catholic Easter was also celebrated on this day. Thus, the information background was again limited only to data on coronavirus and its spread in different countries, as well as on the development of a vaccine against it. Several states have already started testing vaccines, but it is still too early to talk about finding a cure for the COVID-2019 virus.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes rebounded from the corrective level of 38.2% (1.0964), a reversal in favor of the US currency and a slight fall in the direction of the Fibo level of 23.6% (1.0840), which ended after the formation of a bullish divergence in the CCI indicator, which resulted in a reversal in favor of the EU currency. Thus, today the pair can again work out the corrective level of 38.2%. Another rebound from this level will again work in favor of the US dollar and the beginning of a fall in quotes. Fixing the pair's rate above the level of 38.2% will increase the probability of further growth towards the next corrective level of 50.0% (1.1065).
EUR/USD – Daily.
On the daily chart, the euro/dollar pair increased to the corrective level of 38.2% (1.0965) and rebounded from it. The picture remains identical to the 4-hour chart, since the same grid of Fibo levels is in effect. The only thing is that the 4-hour chart shows better the weakness of the movement in recent days.
EUR/USD – Weekly.
On the weekly chart, the euro/dollar pair continues to trade near the lower line of the "narrowing triangle". The rebound of quotes from this line still allows us to count on some growth of quotes in the long term in the direction of the level of 1.1600 (the upper line of the "triangle"). Closing the pair's exchange rate under the "triangle" will work in favor of the US dollar and, possibly, a new long fall.
Overview of fundamentals:
On April 11, the European Union and America did not publish any economic reports or news. Thus, there was no influence of the information background on the pair's movement.
News calendar for the United States and the European Union:
On April 14, the news calendar of the EU and the US again does not contain anything interesting.
COT (Commitments of Traders) report:
On Friday afternoon, a new COT report was released, which turned out to be very interesting. The total number of short and long contracts among major market players decreased again: -29,000 short and -18,000 long. Thus, among the major market players, of which there are currently 255, according to the COT report, there is a desire to close contracts rather than enter into new ones. At the same time, the overall reduction in the number of contracts was due to hedgers, as speculators (the "Non-commercial" group), on the contrary, increased their positions. Thus, in the week before April 7, the number of long contracts decreased by more than short. The total number of contracts remains overweight for short: 568,000-529,000. The last four weeks have shown that both short and long contracts are getting smaller. This means that activity among major players is falling, and the advantage remains with the bears.
Forecast for EUR/USD and recommendations for traders:
At this time, I recommend selling the euro currency, as it was rebounded from the level of 38.2% on the 4-hour chart. Repeated rebound or passage of the divergence peak will increase the chances of a fall in the direction of the level of 1.0840. I recommend buying the euro currency when it is fixed above the level of 1.0964 with a goal of 1.1065. Trading is now conducted on a 4-hour chart.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency for the purpose of providing current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
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