EUR/USD – 1H.
During the last trading day, the EUR/USD pair performed a new reversal in favor of the European currency, resumed the growth process, and worked out the level of 1.2238, from which it again achieved a rebound. Thus, there was already another unsuccessful attempt to close quotes above this level, which stops the further growth of the euro currency. At this time, the pair's movement is more and more like a movement in a side corridor. However, the quotes still left it several times, so there is no clear corridor now. However, the movement pattern on the hourly chart is very strange right now. Bear traders managed to close a few days ago under the rising trend line. However, the pair's price drop did not continue. Bull traders are already returning to the level of 1.2238 almost every day. However, they are not able to continue the growth. The information background of yesterday allowed us to expect any changes in the current graphic picture, but they did not happen. However, the data for the European Union was very positive. The unemployment rate fell to 8%, inflation rose to 2%, and the business activity index in the manufacturing sector rose to 63.1. Thus, all three reports of the day from the Eurozone were positive. But, as you can see in the picture, the direction of movement often changed within the day, and both the euro and the dollar showed growth in turn. In America, the ISM business activity index for the manufacturing sector was also released, increasing compared to the previous month. Thus, all the reports of the last day turned out to be positive, so traders could not make an unambiguous decision and pulled the rope all day. Each in its direction.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes closed under the ascending trend line, and this already allows us to count on a reversal in favor of the US currency and a new strong drop in the pair's quotes in the direction of the corrective level of 161.8% (1.2027). There is also a bearish divergence in the CCI indicator, which increases the probability of the beginning of a fall in quotes. Nevertheless, bull traders are holding their trend with the last of their strength.
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair closed above the level of 161.8% (1.2027), which still allows us to count on continued growth in the direction of the corrective level of 200.0% (1.2356). However, a trend change is now emerging on the lower charts.
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair has made a consolidation above the "narrowing triangle," which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On June 1, many interesting reports were released in the European Union and America. However, they supported either the euro or the dollar, so the pair constantly changed direction during the day.
News calendar for the United States and the European Union:
EU - ECB President Christine Lagarde will deliver a speech (17:10 UTC).
On June 2, the European Union will host a speech by Christine Lagarde, which will undoubtedly interest traders. In the US, the calendar of economic events is empty. In any case, there will be no information background until the evening.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which again showed an increase in the "bullish" mood among speculators. The category of "Non-commercial" traders again increased long contracts, which were opened in the number of 3,781. In addition, speculators also got rid of 1,442 short contracts. Thus, large traders show their desire to continue buying the European currency, leading to even more significant growth. In addition, I note that the total number of contracts for the European currency continues to grow and during the reporting week increased by 29 thousand, which indicates an increase in the interest of traders.
EUR/USD forecast and recommendations for traders:
I recommend selling the pair at a new close under the trend line on the 4-hour chart with targets of 1.2166 and 1.2117. I do not recommend buying the pair now, as there is a high probability of a change in the direction of the trend in the near future.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency, not for speculative profit, but to support current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.