4-hour timeframe
Technical details:
Higher linear regression channel: direction - upward.
Lower linear regression channel: direction - upward.
Moving average (20; smoothed) - downward.
CCI: -146.3658
The EUR/USD currency pair on Monday, January 11, continued its downward movement, which has lasted for three full days. Recently, such events have not often happened in the foreign exchange market. Thus, the euro/dollar pair probably "overheated" enough that market participants finally began to take profits on long positions. We have repeatedly stated that there were no significant reasons and grounds for the growth of the euro currency in recent months. This does not mean that the European currency should not have grown at all in recent months and even a year. This means that it has grown too much. In general, we, as before, are inclined to the option with the end of the uptrend. This does not mean that a strong and long-term downward trend will now begin. Still, in the United States, everything is not fine, so there are no good reasons for the strong growth of the US dollar either. Nevertheless, it will be very logical if the US currency rises by 500-600 points in the coming months.
Meanwhile, all the fun is happening again in the US. And again it is connected with Donald Trump. It's scary to imagine what will happen when Trump leaves office. 50% of all news from the United States concerns the figure of the president. Half of the American media can be closed with the departure of Trump from the post of president. There will be nothing to write about. Of course, this is a joke. But hardly anyone will deny that Trump is a very odious figure. Only Trump could "run into" impeachment 10 days before the end of his presidential term. On the second impeachment. Since the first one was already a couple of years ago. But then Trump's resignation was saved by Republican senators who voted against impeachment. Fair or not, that's the second question. It was the Republicans who controlled the Senate, so, logically, they left their fellow party member in power. And from January 20, 2021, Republicans will no longer control the Senate. They will not control both the White House and the House of Representatives. Thus, there is a very interesting question: will the Republicans defend Trump if it comes to impeachment?
At the moment, it is reported that the lower house of Congress will vote for the impeachment of Donald Trump on January 13. And there is no doubt that the House of Representatives will approve it. Because this chamber is controlled by Democrats. But then everything will again depend on the Senate. At the same time, Republicans may still oppose Trump's resignation and the application of the 25th Amendment to the Constitution, which allows Vice President Mike Pence to remove Trump from his post. That is, Trump can be removed from his post in two ways. The first is through Mike Pence and the 25th Amendment to the Constitution. The second is through impeachment, approved by 2/3 of the senators. As for Mike Pence himself, sources close to him say that the vice president is considering removing Trump from his post. Moreover, the US media also reported that Mike Pompeo (US Secretary of State) held a conversation with US Treasury Secretary Steven Mnuchin on the topic of the president's resignation. Thus, in the highest political circles of the United States, there are rumors, and there is no smoke without fire. It is also noted that the only thing that keeps Pence from applying the 25th Amendment right now is fear for the further behavior of Trump, whose actions can lead to destabilization of the situation and carry a danger to the nation.
Nancy Pelosi also believes that Pence should activate the 25th Amendment and take power into his own hands. "In defending our constitution and democracy, we need to act quickly, because this president is a threat to everyone. The president's attempt to attack our institutions requires a swift response," Pelosi said.
But Trump himself is confident that he will not be removed from the post of president. He believes Mike Pence will not activate the 25th Amendment. But many senators noted that Pence and Trump have not communicated for several days. This can greatly spoil the relationship between the president and the vice president of the country. And it significantly increases the chances that Trump will eventually be impeached. It is noted that Pence was offended by Trump because top White House officials did nothing on January 6 to make sure that Pence and his family were all right during and after the attack on the Capitol. Some believe that Trump is taking revenge on Pence for refusing to block election results in some states. According to the current president, Pence has the authority to cancel the election results. However, Pence declined the offer.
But Trump may become the first US president in history to be impeached twice. Given the fact that Trump has already refused to attend the inauguration of Joe Biden on January 20, this will be the first time since 1869 that a sitting president is not present at the inauguration. Thus, Trump may still have time to set several records, as well as be deprived of the opportunity to run for president in 2024, as he wanted before (and repeatedly voiced this desire). Under US law, a president who is removed from power cannot become president again. Thus, the Democrats now pursue only one goal: to prevent the return of Trump. It is clear that in 10 days, Trump will leave anyway. But if there is an impeachment, he will leave and will not return. Moreover, after the end of his presidential term, he will become a private citizen. That is, various cases can be brought against him, which related to the time when he was still president. And legal proceedings can drag on for years. Democrats again benefit from keeping Trump out of top politics for as long as possible. In general, the motivation of the Democrats is clear, but will the Republicans support them on such an important issue?
The volatility of the euro/dollar currency pair as of January 12 is 86 points and is characterized as "average". Thus, we expect the pair to move today between the levels of 1.2082 and 1.2254. A reversal of the Heiken Ashi indicator to the top can signal a round of upward correction.
Nearest support levels:
S1 – 1.2085
S2 – 1.1963
S3 – 1.1841
Nearest resistance levels:
R1 – 1.2207
R2 – 1.2329
R3 – 1.2451
Trading recommendations:
The EUR/USD pair started a downward movement. Thus, today it is recommended to hold short positions with targets of 1.2085 and 1.1963 until the Heiken Ashi indicator turns up. It is recommended to consider buy orders if the pair is fixed back above the moving average, with targets of 1.2329 and 1.2451.