4-hour timeframe
Technical details:
Higher linear regression channel: direction - upward.
Lower linear regression channel: direction - upward.
Moving average (20; smoothed) - upward.
CCI: 83.1168
The EUR/USD currency pair stopped rampant growth on Tuesday and started a kind of corrective movement. So far, the downward movement does not even resemble a correction, since it is extremely weak. Thus, it will be very good if the price manages to reach at least the moving average line. There is no question of fixing the price below the moving average and changing the trend to a downward one. Despite the fact that we have already warned traders several times that the upward trend may end at any moment, there are no prerequisites for this yet. Therefore, as before, it is not recommended to try to guess the market turn down, and trade strictly on the trend.
There were no macroeconomic publications on Tuesday in either the United States or the European Union. However, by and large, this does not matter now, since traders still ignore most of the statistics. But in America, the state of four crises persists, no optimistic news is received, and everything can only get worse. In principle, if we try to look at the situation in the United States much more broadly, we get a completely different picture. This is now a serious economic crisis in the country, because of "coronavirus", because "China is to blame". There are rallies and protests all over the country right now, because "a white police officer killed a black man in custody". This is now a country mired in a serious political crisis, because Donald Trump does not know how to cooperate with anyone who does not support his point of view. And if you look at the situation in general, try to put it together into one single picture, you get a very complete picture of what is actually happening in the United States.
We should not start with an epidemic, a crisis, or a social crisis. You need to start, as usual, with the activities of Donald Trump. We will not once again list all the "merits" of Trump to the country, thanks to which, it left the WHO, fell out with China, going to start a trade war with the EU, and is in the epicenter of the economic and epidemiological crisis. Trump in fact failed to reach an agreement with China, failed to reach an agreement with the European Union, did not take into account the threat of an epidemic, then spat on the health and lives of Americans when "opening" the economy, fearing that during the time that the country will be in "lockdown", other international competitors will go far ahead, and he will lose all chances of re-election for a second term. Trump also failed to stop and calm protesters across the country, because he did not try to do so. Instead of supporting the protesters (rallies are not prohibited by US laws), he almost immediately offered to disperse all those who prevent him from achieving personal goals, disperse with the help of the army, which shocked the Pentagon and the army itself, which has never been used to suppress riots and rallies. And what is the result? As a result, we get that there are quite a few interested in Trump being re-elected for a second term in the world and in the US.
China does not benefit from Trump, because it is no longer possible to trade with America as it was before, and Trump plans to tighten the screws even more and balance the trade balance with China, which is naturally not profitable for the PRC itself. Trump is not beneficial to anyone inside the country, since even Republicans already understand that under Trump, the country will be forever mired in conflicts and internecine strife. On the one hand, the United States, like other "superpowers", is often involved in military conflicts, trade conflicts, and conflicts in general. As they say, "because they can". On the other hand, a country should come out of every conflict with some profit, with some benefit. What are the benefits of Trump's actions? He himself destroyed the economy, completely destroyed normal relations with China, and still no one knows how, why, or whether the "coronavirus" broke out on purpose. Given which country was most affected by COVID-2019, certain doubts are creeping in.
Now let's move on to rallies and protests. We have also questioned the "idea" of the rallies themselves. Yes, the murder of George Floyd is a very sad event that certainly deserves attention and investigation. But does it deserve two months of rallies and protests across the country? Do Americans really care so much about racism in the country? Especially when there are far more serious problems that affect everyone, whether white or black. We are already inclined to believe that all the unrest in American cities is supported and "fueled" by some hidden force. And given the fact that Trump does not benefit from all these rallies, it is certain that this force is counteracting the US president. Well, the situation with COVID-2019 in general, no matter how you look at it, works against the US leader. At this time, whatever Trump does, he will still come under criticism. Voters and ordinary citizens are no longer interested in how many tests the United States have conducted. And no one believes in Trump's promises anymore. Leading US media outlets have already published the figure of 20,000 several times. That's how many times Trump intentionally or accidentally misled in the course of his speeches, statements and comments. 20,000 times in less than 4 years. Thus, the next statement of Trump that the vaccine against "coronavirus" will be ready for the winter, no one is enthusiastic. On November 1, Trump can declare without batting an eye that if he is not elected, the development of the vaccine will stop. No one will be surprised. More confidence now in Anthony Fauci, the country's chief epidemiologist, whom the White House is trying to keep quiet, as his forecasts are completely disappointing. And given the fact that the US population blames Trump for the scale of the pandemic and the losses, Fauci just confirms that Trump is to blame, and we can expect even worse consequences of the pandemic due to the negligence of the country's government. Thus, it is possible that there is already a certain conspiracy against Trump in the US, designed to prevent him from winning the election in November.
On the third trading day of the week in the US, it is planned to summarize the results of the Fed meeting. None of the market participants expects changes in the parameters of monetary policy, so it is unlikely that this meeting and its results will be unexpected or interesting. Most likely, the meeting will be "passing". Quantitative easing and economic stimulus programs are unlikely to change in the face of a pandemic. Thus, the greatest interest will be aroused by the Fed's press conference, which may contain important and interesting information about the prospects of the economy, the timing of its recovery and the future actions of the regulator.
The volatility of the euro/dollar currency pair as of July 29 is 95 points and is still characterized as "average". Thus, we expect the pair to move today between the levels of 1.1632 and 1.1822. The upward turn of the Heiken Ashi indicator signals the end of the downward correction within the ascending trend.
Nearest support levels:
S1 – 1.1719
S2 – 1.1597
S3 – 1.1475
Nearest resistance levels:
R1 – 1.1841
R2 – 1.1963
Trading recommendations:
The EUR/USD pair started a very weak round of corrective movement. Thus, today it is recommended to wait for the completion of the correction, which is signaled by the reversal of the Heiken Ashi upwards, and again buy the euro with the goals of 1.1822 and 1.1963. It is recommended to open sell orders no earlier than when the pair is fixed below the moving average line with the first target of 1.1475.