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On Tuesday, the EUR/USD pair reversed to the downside and resumed to fall towards 1.0315. However, the price failed to hit this level and started to move upwards to the correctional level of 200.0% - 1.0430. As for now, there was a small decline but we cannot say for sure that the US dollar may begin to grow again.
Yesterday, the economic calendar was almost empty. Traders are focused on the second half of the week when Jerome Powell's speech and important US statistics will be released. The EU inflation report is also expected today. The next few days promise to be interesting and traders are likely to make their trading decisions easier.
Let's start with the EU inflation report. Many traders already understand that the CPI and inflation are connected directly. If inflation shows a strong slowdown today, we can expect the European currency to fall. Exactly the same happened a few months ago with the US dollar when inflation started to slow down in the US.
Powell's speech is a more significant event. Many believe that the interest rate may start to slow down already in December but they forget that it could grow weaker but longer. The FOMC members stressed this months ago. Thus, we are still talking about a few more months of monetary tightening. In the evening, the Fed chairman may focus on the labor market or inflation, or he may state clearly what to expect from the Fed at the last meeting of the year. His frankness will determine whether traders pay attention to his remarks tonight.
On the 4-hour chart, the pair has settled above the correctional level of 127.2% - 1.0173. However, it is returning to this level. If the price rebounds from it, the EU currency may receive support and grow to the correctional level of 100.0% - 1.0638. On the contrary, if the price drops and fixes below 1.0173, the euro is likely to fall towards the Fibo level of 161.8% - 0.9581.
COT report
The fresh COT report was several days late and came out only on Wednesday. Last reporting week, speculators opened only 229 long contracts and closed 10,217 short ones. It means that the sentiment of large traders became more bullish. The total number of long contracts is now 239,000, and the number of short contracts stands at 116,000. The European currency is growing at the moment, which corresponds to the data of COT reports. At the same time, the number of longs is twice as high as the number of shorts. During the last few weeks, the euro had more chances to increase but traders were not ready to give up their purchases of the US dollar. The situation is changing in favor of the euro but it may change for long time. Notably, the pair closed above the descending trading channel on the 4-hour chart. Accordingly, we can see the continued growth of the euro, which is not fully consistent with the current information background.
US and EU economic calendar:
EU - Consumer Price Index (CPI) (10-00 UTC).
US - ADP Non-Farm Employment Change (13-15 UTC).
US - GDP (13-30 UTC).
US - Federal Reserve Chairman Jerome Powell speaks (18-30 UTC).
On November 30, the EU and US economic calendars is full of interesting events. The influence of the information background on the market may be very strong today.
EUR/USD forecast and recommendations for traders:
One may sell the euro on a rebound from 1.0430 on the hourly chart or if the price closes below 1.0315. The target is located at 1.0315 or 1.0197. At the same time, it is better to buy the euro on a rebound from 1.0315 on the hourly chart with the target at 1.0430.
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