Another trading week on the Forex currency market is coming to an end. In this article, we will see what achievements the main EUR/USD currency pair ends the current five-day period. I will start with the fact that recently the market sentiment is clearly in favor of the US currency. It affects the technical picture of the euro/dollar, which we will return to a little later. In the meantime, let us briefly talk about the main factors that contribute to strengthening the US dollar's position. As it became clear from the July minutes of the Open Market Committee (FOMC), the heads of the Federal Reserve System (FRS) do not rule out a reduction in the volume of bond purchases closer to the end of this year. However, the risk factors are still the spread of COVID-19, inflation, and stable recovery of the labor market to the levels observed before the start of the COVID-19 pandemic. Sooner or later, everything comes to an end, including such a large-scale program of stimulus measures that the Fed has deployed to maintain and restore economic activity. However, few people expected that the reduction of stimulus measures could begin by the end of this year.
Daily
The key support zone of 1.1750-1.1700 restrained the pressure of sellers. However, the more "hawkish" than expected rhetoric in the July protocols became the catalyst that helps to break through this important price area. So, during yesterday's trading, the EUR/USD bears increased the pressure and ended the session at 1.1675. However, as has been noted more than once, one closed candle should not be used to judge the truth of the breakdown of a particular level or line. Especially when it comes to such a significant mark for the market as 1.1700. Let's see at what level the trading of the current week will end. A close below 1.1700 will increase the probability of a true breakdown of this level. If the euro bulls manage to correct the situation at least a little before the end of the week and close trading above 1.1700, the question of a breakdown of this level will remain open. We will talk about this in more detail on Monday, taking the closing of weekly trading into account.
H1
After falling to 1.1666, the pair bounced back to 1.1704 but could not return above 1.1700. At the end of the article, the eurodollar trades are in the range of 1.1666-1.1704, which indicates the importance and significance of 1.1700. We will still see attempts to return to this level and transfer trading on EUR/USD. Considering the recent FOMC protocols, which contributed to the large-scale strengthening of the US dollar, I believe that the players have little chance of returning the trades to the exchange rate, and most importantly, consolidating them above the strong historical area 1.1700-1.1750. Based on this assumption, I suggest using the short-term rises of the pair in the designated zone for its sales. At the moment, this is the main trading idea for EUR/USD.