02.12.202013:53 Forex Analysis & Reviews: EUR/USD: plan for the American session on December 2 (analysis of morning deals)

To open long positions on EURUSD, you need:

In my morning forecast, I paid attention to sales after a false breakout in the resistance area of 1.2082, which happened. If you look at the 5-minute chart, you will see how buyers make an unsuccessful attempt to consolidate above 1.2082, forming a false breakout, which became a signal to open short positions. The euro sellers' target was reached around 1.2046, and the downward movement was about 40 points. But judging by what is happening at the level of 1.2046, the downward movement has not ended yet.

In the second half of the day, buyers of the European currency need to try hard to protect the support of 1.2046. Only the formation of a false breakout, which may occur after an unsuccessful attempt by the bears in the second half of the day to gain a foothold below 1.2046, will be a signal to open long positions. The initial target will be the area of 1.2082, from where the market turned down today. Only a break and consolidation above this resistance, with a top-down test, will be an additional signal to open long positions in the continuation of the bull market and with the main goal of updating the maximum of 1.2135, where I recommend fixing the profits. The longer-term target of the bulls at the end of the week will be the resistance of 1.2194. The lack of bull activity in the area of 1.2046 may push the euro back to the support of 1.2008, from which you can buy EUR/USD immediately for a rebound, at least with the aim of a correction of 15-20 points within the day. There are also moving averages that play on the side of buyers.

To open short positions on EURUSD, you need:

Sellers of the euro perfectly coped with their task, forming a false breakout at the level of 1.2082, which led to a downward correction to the support area of 1.2046. The main fight is now being waged for it. Fixing below this level with a test of it from the bottom up will be a good sell signal with a return of EUR/USD to the area of a large minimum of 1.2008, where I recommend fixing the profits. The bears' longer-term goal will be to close the trading week at 1.1964, which will completely negate all bullish momentum. In the second half of the day, another speech by representatives of the Federal Reserve System is expected, which may return pressure on the US dollar, as well as November data on the labor market. A bad report is sure to bring back demand for the euro. In case of recovery of EUR/USD in the second half of the day and a breakout of the maximum of 1.2082, it is better not to rush with sales. In this scenario, you can count on short positions only for a rebound from the resistance of 1.2135 or sell EUR/USD from the new maximum in the area of 1.2194 with the aim of a downward correction of 15-20 points within the day.

Let me remind you that the COT report (Commitment of Traders) for November 24 recorded an increase in long and a reduction in short positions. Buyers of risky assets believe in the continuation of the bull market, and in the breakthrough of the psychological mark in the area of the 20th figure, which was tested on November 30. Thus, long non-profit positions increased from 203,551 to 206,354, while short non-profit positions decreased to 68,104 from 69,591. Total non-commercial net position rose to the level of 250,138 from 133,960 a week earlier. It is worth paying attention to the growth of the delta after its 8-week decline, which indicates a clear advantage for buyers and a possible resumption of the medium-term upward trend for the euro. Talk of a larger recovery will only be possible after European leaders agree on a new trade agreement with the UK. Otherwise, we will have to wait for the lifting of restrictive measures imposed due to the second wave of coronavirus in many EU countries and expect that the European Central Bank will not introduce negative interest rates at the December meeting.

Signals of indicators:

Moving averages

Trading is conducted above 30 and 50 daily moving averages, which indicates the bullish nature of the market.

Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of classic daily moving averages on the daily chart D1.

Bollinger Bands

A break of the upper limit of the indicator in the area of 1.2082 will lead to new growth of the pair. If the pair falls, the lower border of the indicator around 1.2030 will provide support.

Description of indicators

• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
• MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-profit speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between the short and long positions of non-commercial traders.