EUR / USD. January 11th. The trading system. "Regression Channels". Jerome Powell's rhetoric remains "pigeon"

4-hour timeframe


Technical details:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - up.

CCI: 22.4301

The EUR / USD currency pair on Friday, January 11, after a rather small correction, resumed an upward movement, as indicated by the indicator Heikin Ashi. Thus, after overcoming an important area of resistance around the level of 1.1470, we can say that the pair has moved to an uptrend, which remains at the moment. Jerome Powell's speech yesterday was softer than previously received information from the Fed, but the rhetoric remained "pigeon". The head of the Fed said that the previously announced plan for two increases in the key rate in 2019 could be revised downwards. Further, the head of the Fed is concerned about the slowdown in economic growth in China, and a slowdown in US inflation could be just the reason that will not allow raising rates in the future. In general, Powell said that the regulator will not rush to raise the rate. On the last trading day of the week in the United States, it is scheduled to publish a report just on inflation. The forecast is 2.2% in December y/y. Any value of the indicator below the forecast can "confirm" Powell's fears and put pressure on the US dollar position in the context of one day. The technical picture of the instrument also now suggests the continuation of the upward movement.

Nearest support levels:

S1 - 1.1475

S2 - 1.1414

S3 - 1.1353

Nearest resistance levels:

R1 - 1.1536

R2 - 1.1597

R3 - 1.1658

Trading recommendations:

The EUR / USD currency pair has resumed its upward movement. Therefore, at the moment, it is recommended to trade on the increase with the aim of 1.1597. A new turn of the Heikin Ashi indicator down will signal a new round of downward correction.

Short positions will become relevant, not earlier reversing the pair below the moving average line. In this case, the tendency for the pair to change to downward, and the first goal will be the Murray level of "3/8" - 1.1414.

In addition to the technical picture, you should also consider 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 younger 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 -