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EUR/USD – 1H.
On October 6, the EUR/USD pair performed a fall to the ascending trend line, near which it stopped. The pair's rebound from this line will work in favor of the European currency and resume growth in the direction of the corrective levels of 38.2% (1.1765) and 50.0% (1.1812). Fixing quotes under the trend line will change the mood to "bearish" and allow us to count on the continuation of the fall in the direction of the levels of 23.6% (1.1707) and 0.0% (1.1612). Yesterday was filled with quite interesting news. First, Donald Trump was discharged from the hospital, which raised a huge number of questions about his condition. A little later, he made the first landmark decision after returning to work. Trump officially announced that negotiations with the Democrats on a new package of financial assistance to the US economy are being completed and will be resumed after the presidential election. Let me remind you that we have repeatedly received information that Treasury Secretary Steven Mnuchin and Speaker of the Lower House of the US Congress Nancy Pelosi continue to negotiate. However, the Democrats offered "too expensive" packages of care, and the Republicans are too "small". Trump also said that "after his victory, a large package of assistance will be provided to stimulate the economy". Meanwhile, the ratings of support for Donald Trump continue to decline. More experts and analysts believe that the current president will not be re-elected for a second term.
EUR/USD – 4H.
On the 4-hour chart, the graphic picture remains very sad. The pair's quotes returned to the side corridor and returned to its lower border. Thus, either the pair is trying to resume the fall process, or it will rebound again from the lower border of the corridor and resume the growth process in the direction of the upper border. It is not yet clear. Even anchoring under the corridor does not guarantee a further downward trend. The pair has been trading mostly horizontally in recent months.
EUR/USD – Daily.
On the daily chart, the EUR/USD pair performed a sharp reversal in favor of the EU currency and began the process of returning to the weak level of 261.8% (1.1825). However, a drop in prices still looks more likely. Fixing the pair's rate above the level of 261.8% will increase the probability of further growth towards the level of 323.6% (1.2084).
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair has completed a consolidation above the "narrowing triangle", which now allows us to count on further growth of the euro currency, which may be strong, but in the long term.
Overview of fundamentals:
On October 6, ECB President Christine Lagarde made two speeches in the European Union, which did not tell traders anything interesting. There was no reaction to her speech. The same goes for Jerome Powell's performance.
News calendar for the US and the European Union:
EU - ECB President Christine Lagarde will deliver a speech (12:00 GMT).
US - publication of the minutes of the Fed meeting (18:00 GMT).
On October 7, the European Union will host another speech by Christine Lagarde, and the US will publish the minutes of the last FOMC meeting. This is the most important news of the day.
COT (Commitments of Traders) report:
The last COT report was quite boring. During the reporting week, the "Non-commercial" category of traders got rid of both long and short contracts. With approximately equal amounts. Thus, the mood of speculators remained the same. In general, all categories of traders also closed approximately the same number of long and short contracts. Thus, there were really few changes during the reporting week. In general, major traders still have about 5 times more long contracts than short. This means that speculators still believe that the European currency will continue to grow. But how long will their faith last?
Forecast for EUR/USD and recommendations for traders:
Today I recommend selling the euro currency with targets of 1.1707 and 1.1612 if the close is made under the trend line on the hourly chart. I recommend buying the pair today with the targets of 1.1765 and 1.1812 if a pullback is made from this trend line.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency, not for speculative profit, but for 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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