EUR / USD. November 28. The trading system. "Regression Channels". The first signs of a downtrend completion

4-hour timeframe


Technical details:

The senior linear regression channel: direction - down.

The younger linear regression channel: direction - down.

Moving average (20; smoothed) - down.

CCI: -108.8465

The EUR / USD currency pair on Wednesday, November 28, is slowly but surely continuing its downward movement. In principle, no extremely important news over the past 24 hours has been made available to traders. Thus, there were no reasons for changes in the mood among market participants. In favor of the European currency now says several factors that have appeared just recently. First, there are signs that the Fed will stop raising rates over the next year, and perhaps even reduce it. Secondly, the US dollar has risen in price against the euro for several years. And any trend ends sooner or later. Of course, this does not mean that only on the basis of these two reasons will traders start buying Eurocurrencies dramatically. Nevertheless, if the situation with Brexit is resolved before the end of the year, then in 2019 the euro and the dollar will be included in a certain balance. If the ECB starts tightening monetary policy in 2019 and manages to negotiate a trade relationship with Trump, the euro will finally be able to breathe freely. By the way, the trade war may soon begin to work against the US dollar. In general, there are grounds for assuming the end of a downtrend. If we return to a more short-term state of affairs, then at the moment the key level for the pair 1.1220 is the previous local minimum. If the bears push it, the downtrend will continue.

Nearest support levels:

S1 - 1.1292

S2 - 1.1230

S3 - 1.1169

Nearest resistance levels:

R1 - 1.1353

R2 - 1.1414

R3 - 1.1475

Trading recommendations:

The EUR / USD currency pair has worked at a level of 1.1292. Since there are currently no signs of the beginning of the correction, it is recommended to hold the shorts with the following target 1.1230. Heikin Ashi's upside reversal will serve as a signal to manually reduce the shorts.

Buy orders are not relevant now, as all trend indicators are down. It is recommended to open longs if traders overcome a moving average line with the first goal of 1.1414.

In addition to the technical picture should also take into account the fundamental data and the time of their release.

Explanations for illustrations:

The senior linear regression channel is the blue lines of the unidirectional movement.

The junior linear regression channel is the purple lines of the unidirectional movement.

CCI - blue line in the indicator window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heikin Ashi is an indicator that colors bars in blue or purple.

The material has been provided by InstaForex Company -