FX.co ★ EUR/USD: trading plan for American session on June 15. Analysis of morning trades. EUR rises amid expectations of rate hike by ECB

In my morning article, I turned your attention to 1.0822 and recommended making decisions with this level in focus. Now, let's look at the 5-minute chart and figure out what actually happened. A breakout and a downward retest of this level led to a buy signal. At the time of writing, it brought about 25 pips of profit. For the afternoon, the technical outlook has been revised.

When to open long positions on EUR/USD:

Given that speculators are waiting for the ECB's rate decision, and I have already mentioned how to trade in such a situation in my morning forecast, I would like to talk more about US macro stats. They could increase pressure on the EUR/USD pair in the afternoon. Retail sales and initial jobless claims will be in the limelight. If they turn out to be better than forecasts, the euro is likely to fall, especially after the speech of Christine Lagarde. She may highlight the problems of the eurozone economy. The US dollar may also advance amid positive figures on industrial production and the Philly Fed Manufacturing Activity Index.

For this reason, I plan to open long positions only on a decline and a false breakout of the support level of 1.0808, which was formed today. At this level, the moving averages are passing in positive territory. It may give new entry points into long positions with a jump to a monthly high of 1.0862. A breakout and a downward retest of this level will boost demand for the euro, creating an additional entry point into long positions with a rise to 1.0903. A more distant target will be the 1.0950 level where I recommend locking in profits.

If EUR/USD declines and bulls fail to defend 1.0808, the pressure on the euro will return even after the ECB raises the interest rate. In this case, only a false breakout of the support level of 1.0777 will provide new entry points for opening long positions. You could buy EUR/USD at a bounce from 1.0734, keeping in mind an upward intraday correction of 30-35 pips.

When to open short positions on EUR/USD:

Now, bears do not have any chance to regain control. Therefore, nobody is trying to sell the euro even at the current upward movement to an intraday high. Christine Lagarde's speech could tip the balance. For this reason, it is better not to rush with sales in the afternoon. I would advise you to go short only after an unsuccessful consolidation above the resistance level of 1.0862. It acts as a monthly high. A false breakout of this level could give a sell signal that may push the pair to 1.0808 where the moving averages are passing in positive territory. Consolidation below this level as well as an upward retest could trigger a downward movement to 1.0777 and 1.0734. A more distant target will be the 1.0705 level where I recommend locking in profits.

If EUR/USD rises during the US session and bears fail to protect 1.0862, which is likely because the ECB sticks to aggressive tightening, it may lead to a sharp rise. In this case, I would advise you to postpone short positions until a false breakout of the resistance level of 1.0903. You could sell EUR/USD at a bounce from 1.0950, keeping in mind a downward intraday correction of 30-35 pips.

COT report

According to the COT report (Commitment of Traders) for June 6, there was a drop in long positions and a slight increase in short ones. Despite all this, the Fed's rate decision this week may significantly affect market sentiment. Hence, the above-mentioned changes are not important. If the Fed decides to skip a rate increase, the euro will climb markedly. Risk appetite will improve amid the ECB's commitment to a hawkish stance even despite the first signs of a slowdown in inflationary pressure. The COT report showed that long non-commercial positions decreased by 5,757, to 236,060, while short non-commercial positions rose by 1,457, to 77,060. At the end of the week, the total non-commercial net position declined and amounted to 158,224 against 163,054. The weekly closing price dropped to 1.0702 against 1.0732.

Indicators' signals:

Trading is carried out above the 30 and 50 daily moving averages, which indicates a further rise in the euro.

Moving averages

Note: The period and prices of moving averages are considered by the author on the H1 (1-hour) chart and differ from the general definition of the classic daily moving averages on the daily D1 chart.

Bollinger Bands

If EUR/USD moves up, the indicator's upper border at 1.0865 will serve as resistance.

Description of indicators

• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked yellow on the chart.
• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked green on the chart.
• MACD indicator (Moving Average Convergence/Divergence - convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between the short and long positions of non-commercial traders.