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Hi, dear traders!
In this article, we are going to sum up the results of trading on EUR/USD in February. We will also have a closer look at the results of the last trading week as well as highlight the main macroeconomic events of the current week. Additionally, we will try to predict the price movement of the pair. The coronavirus topic is still in limelight. The mass vaccination and quarantine restrictions aimed at preventing the spread of the pandemic remain the main tools in the fight against the deadly virus. At the same time, in a number of European countries, protests are taking place due to restrictive measures that people have been already tired of. The main macroeconomic publication of the current week is certainly the US jobs data, which is on tap on Friday. Investors are also anticipating speeches of the President of the European Central Bank (ECB), Christine Lagarde, and the Chairman of the US Federal Reserve (Fed), Jerome Powell. There will be other less significant reports. Yet, we will mention them on the day of their release. As for today, it is necessary to pay attention to Germany's Consumer Price Index (CPI) and the US ISM manufacturing index. On top of that, today, the head of the ECB, Christine Lagarde, will deliever a speech.
Monthly
Following the results of February, the EUR/USD pair ended the month with a small decline. On the chart, the candlestick with a long upper and lower shadow was formed. It seems that market participants are hesitant to pick up a trend for the pair. At the same time, bulls are unable to break through the level of 1.2200 consolidate there, whereas bears cannot push the pair under the same level. The quote is located in the range of 1.2242-1.1952. The price does not fall below the level of 1.2000 thanks to strong support by the orange 200 exponential moving average, which is located just at 1.2008. Judging by the February candlestick, it is difficult to determine the further movement of the euro/dollar pair. On the monthly chart, we should focus on the high and low values of February. The fact is that the pair may close the current month above or below these values. It will help clarify the further trajectory of the pair. If in March, the pair rises above 1.2242, it is likely to gain momentum. If it finishes the month below 1.1952, it is likely to resume the downward movement.
Weekly
Last week, demand for the US currency was buoyant. It asserted strength against its main rivals. Notably, the previous Doji candlestick had a long low shadow, which usually indicated the growth. So, the EUR/USD had made several attempts to advance. However, it faced the strong resistance level near 1.2240. The pair was unable to break it and go down. As a result, the candlestick showed a bearish bias and a very long upper shadow on the weekly chart. Most often, such candlesticks indicate the inability of the quote to rise. Therefore, it signals its subsequent decline. I think we should pay attention to the red line of the Tenkan Ichimoku indicator. As you can see, the pair has been unable to cross this line for several weeks in a row. After an unsuccessful attempt to break the high of 1.2350, it declined lower. Its subsequent drop along with the bearish divergence of the MACD indicator indicate a downward movement. If so, it is recommended to open short traders on the EUR/USD. It is better to open short positions when the pair attempts to return above the level of 1.2100. Tomorrow, we will look at smaller time intervals and try to determine more accurate levels for entering the market. In the meantime, taking into account the technical signals on the two charts, bears are likely to rake control over the pair.
Good luck!
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