Last week, all major currencies, except for the Swiss franc, strengthened against the US dollar. In particular, the main currency pair EUR/USD increased by 0.33%. The factors that influence investor sentiment and the price orientation of the foreign exchange market are still the same. Let's briefly recall them, after which we will proceed to the consideration of the technical picture for EUR/USD.
First of all, market participants are concerned about when the US Federal Reserve System (FRS) will begin tightening its monetary policy. Naturally, sooner or later, the Fed will change its course. Nothing lasts forever. However, for this to happen, several factors must coincide. First of all, the normalization of the situation with the spread of COVID-19, as well as the economic component, where the main attention of the Federal Reserve is attracted by the increased inflationary pressure, as well as the pace of recovery of the labor market. In my personal opinion, the Fed will be as cautious as possible in changing its monetary policy. They will begin to implement it only after fully convincing themselves of the practicality of such a step. Following the Fed, other leading world central banks will also reach out. It is unlikely that anyone will run ahead of the locomotive. For example, in France, the authorities introduced sanitary passes, which caused significant dissatisfaction with about a third of the country's population. People hold regular protests against such decisions. In Australia, they also had to tighten sanitary restrictions, as the number of infections in this country has recently increased.
Looking at the economic calendar, I can assume that the main events for EUR/USD will be the eurozone GDP data and the publication of the minutes of the US Open Market Committee (FOMC). The first day of the trading week that has begun will be uninformative. There are no statistics from Europe planned for today at all. From across the ocean, the index of activity in the manufacturing sector from the Federal Reserve of New York will be published at 13:30 London time. Late in the evening, at 21:00 (London time), data on the total volume of purchases of American securities by foreign investors and the net volume of purchases of the same assets will be received from the United States. It is characteristic that even 6-7 years ago, these reports had a serious impact on the price dynamics of the US currency, even sometimes changing or starting trends. But, as they say, it was a long time ago and is not true.
Weekly
And yet, repeated assumptions that it would be extremely difficult to overcome the price support zone of 1.1750-1.1700 were again justified. No matter how hard the bears tried to move the trading course under 1.1700, they failed to do it again. The pair began to enjoy active demand and turned up. It is worth noting the black 89 EMA, which also provided support for the quote. As a result, the EUR/USD pair ended trading on August 9-13 at 1.1795, which is slightly lower than the most important value of 1.1800.
On the other hand, the last weekly candle looks pretty much like a reversal, so if the pair shows growth this week, you should not be surprised. In addition, there was no clearly defined trend for EUR/USD, and there is no such thing. At the end of the weekly chart analysis, I note that the key resistance is in the area of 1.1795-1.1840, where the previous highs were shown, and the red Tenkan line of the Ichimoku indicator passes. The support is the same, and it is located in the strong technical area of 1.1750-1.1700. It is noteworthy that the designated resistance zone is also extremely difficult to pass, so the medium-term prospects of the euro/dollar may depend on what will break through.
Daily
There is still an unloaded bullish divergence of the MACD indicator on the daily chart, which increases the chances of a bullish scenario. However, as can be seen on the chart, at the moment, the Tenkan and Kijun lines of the Ichimoku indicator have a strong resistance to growth attempts, which converged near 1.1800, just above this landmark mark. In order not to beat around the bush for a long time, I will immediately indicate the range in which the pair is trading, and the subsequent direction will depend on which way it will exit from it. In principle, this is 1.1700-1.1800, but given the weekly Tenkan line, the corridor can be expanded and designated as 1.1700-1.1840. If we touch on which positions it is better to give your preference, then as for me – long ones. You can try to buy EUR/USD on a decline in the price zone of 1.1775-1.1760. However, sales also have their relevance, especially in the resistance area of 1.1795-1.1840. Nevertheless, with both positioning options, it would be nice to see clear signals. At the moment, the author personally does not observe such signals.