EUR/USD – 1H.
On December 28, the EUR/USD pair performed a new reversal in favor of the European currency near the ascending trend line and began a new growth process in the direction of the corrective level of 323.6% (1.2308). At the same time, the activity of traders in recent days is not too high, and the "bullish" mood is not the strongest. It can be seen that traders are already in a festive state. The pair does not "fly" from side to side - this is good. The movements are calm. And the information background is now practically absent. Perhaps this is partly the reason for the weakness of the trend and the low activity of traders. Nevertheless, a couple of interesting news is still there. First, yesterday, the Lower House of the US Congress voted for a bill that implies an increase in cash payments to Americans under the economic stimulus program from $ 600 to $ 2 thousand. The House of Representatives, which is controlled by Democrats, approved the increase. Now the same bill will have to be approved by senators, where Republicans already dominate. And it was the Republicans who previously opposed any increase in payments to American citizens. Second, the House of Representatives approved the US defense budget for 2021, which was previously vetoed by Donald Trump. The same thing - now the budget must be approved by the Senate, and if it happens, it will be the first time in the entire term of the Trump presidency that his veto will bypass both Houses of Congress. However, this will require the budget to be approved by at least 2/3 of the senators.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes performed a reversal in favor of the euro and resumed a slight growth process in the direction of the corrective level of 200.0% (1.2353). The rebound of quotes from this level, which can happen very soon, will allow traders to count on a reversal in favor of the US currency and some fall. Closing the pair's rate under the trend line will also work in favor of the beginning of a fall in quotes.
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair continue the process of growth in the direction of the corrective level of 423.6% (1.2495). Until the moment when the pair makes a consolidation under the level of 323.6%, there are still high chances of growth.
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair performed a consolidation above the "narrowing triangle", which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On December 28, there was not a single important news or report in the United States and the European Union. There was no information background. Events unfold only in the US Congress, where deputies at the end of the year adopted several important documents and budgets.
News calendar for the United States and the European Union:
On December 29, there will again be no reports and news in America and the European Union. The information background will be absent today.
COT (Commitments of Traders) report:
The latest COT report from December 15 showed a sharp increase in the number of open short contracts by the "Non-commercial" category of traders, which is considered the most important. Before that, speculators had been building up long contracts for four weeks. And now the new COT report, which was released only today, again shows the build-up of long contracts by speculators. This means that they are once again beginning to believe in the European currency, which has only been growing in recent months. The total number of long-contracts focused on the hands of large players is 224 thousand, which is three times more than the number of short-contracts. Since speculators do not currently reduce the number of long contracts and do not increase the number of short ones, I conclude that the euro may grow further. However, let me remind you that each COT report is released three days late, and also describes changes that have already occurred.
EUR/USD forecast and recommendations for traders:
On Tuesday, I recommend selling the euro if the price is fixed under the upward trend line on the hourly chart with a target of 1.2153. New purchases of the pair can be opened with a target of 1.2256 when the quotes rebound from the ascending trend line on the hourly chart.
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 to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.