EUR/USD – 1H.
The EUR/USD pair as a whole continued the growth process inside a new and relatively weak upward trend corridor. Thus, the mood of traders is now characterized as bullish. However, the COT reports characterize it as bearish. It's a complicated situation. Bear traders failed to close at the level of 1.1760, where the pair's price drop ended at the moment. Thus, it is now more likely that the growth process will continue in the direction of the corrective level of 61.8% (1.1919). However, traders can be said to be to blame for not using excellent chances last week. Let me remind you that, in addition to the Fed meeting, there were reports on GDP in the US and the EU and a whole package of reports in the European Union. The reports were important. However, traders practically did not react to them in any way. And now there is nothing to react to.
Only two business activity indices in the US and the EU were released on Monday, which interested traders even less than last week's reports. Although the ISM manufacturing index in the United States declined quite significantly, this did not affect the mood of traders in any way. Today, there will be no single event at all. In America, it seems that the US Congress has agreed on a new package of incentives for the American economy for $ 1 trillion. At the same time, the European Union continues to conflict with the UK regarding the Northern Ireland protocol. There is also an increase in the delta strain of coronavirus in the United States, and it seems to me that this is the most significant information that can affect the dollar. However, after almost 200 thousand cases on July 30, July 31, and August 1, the total number of infections did not exceed 25 thousand per day. Thus, America can avoid a strong fourth wave of the pandemic.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes performed an increase to the corrective level of 61.8% (1.1890). The rebound of the pair's exchange rate from this level worked in favor of the US dollar. However, a new decline in quotes in the direction of the Fibo level of 76.4% (1.1782) has not yet begun. Fixing the pair's exchange rate above the level of 61.8% will work in favor of resuming growth in the direction of the next corrective level of 50.0% (1.1978). The movements of the pair remain very weak. There are no emerging divergences observed in any indicator.
News calendar for the United States and the European Union:
On August 3, the calendars of economic events in the European Union and America do not contain anything interesting. However, traders are not too interested in strong and important statistics right now anyway. Last week, they had a chance to trade actively and work out important information from America and the European Union. But they prefer to play as carefully as possible.
COT (Commitments of Traders) report:
The latest COT report showed that during the last reporting week, the mood of the "Non-commercial" category of traders again became more "bearish." Major players opened 1,775 short contracts on the euro and closed 5,665 long contracts. Thus, in the last six weeks, the number of short contracts focused on the hands of speculators has increased by almost 70 thousand, and the number of long contracts has decreased by 11. Therefore, a further fall in the European currency is very likely, according to COT reports. However, over the past week, the euro/dollar pair has not been able to continue the decline in quotations and, on the contrary, has begun the growth process.
EUR/USD forecast and recommendations for traders:
Today, I recommend staying in the pair's purchases with a target of 1.1919 on the hourly chart. If there is a close above it, then purchases should be kept with a target of 1.1985. To sell, I recommend waiting for the quotes to rebound from the level of 1.1919 on the hourly chart or close below the level of 1.1837. The target is the nearest corrective level.
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 ensure current activities or export-import operations.
"Non-reportable positions" are small traders who do not have a significant impact on the price.