4-hour timeframe
Technical details:
The senior linear regression channel: direction - sideways.
The junior linear regression channel: direction - down.
Moving average (20; smoothed) - down.
CCI: 64.6385
The last trading day of last week ended with an unexpected strengthening of the European currency. From the negative data of the second half of Friday, we can note only the unexpectedly failed report on industrial production in the United States. This indicator lost 0.6% in January against the forecast of + 0.1%. It also appeared that Donald Trump is going to introduce a state of emergency on the border with Mexico in order to circumvent Congress in the matter of financing the construction of the wall. According to Democrats, Trump is abusing power, but, knowing Trump, he is unlikely to stop halfway in this matter. According to the leader of the United States, most of the drug smuggling from Mexico goes right through unprotected parts of the border. Money for this project will have to come from the military budget, however, according to Trump, the required amount will not affect the funding of various military programs. Despite the rather interesting nature of these events, it is unlikely that they provoked the fall of the US dollar. Most likely, the fall of the US currency was due at least to technical factors. At the moment, the pair has worked a moving average line, but could not consolidate above it. A rebound in the price from the MA can trigger a resumption of the downward movement.
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 adjusted to the moving average. The rebound in the prices from the MA and the turn of the indicator Heikin Ashi down will signal the resumption of the downward movement and the short positions with targets in the area of 1.1250 - 1.1230 will become relevant.
Buy orders are recommended to be considered no earlier than the Bulls overcome the moving average line with the first target of 1.1353. To date, neither in the States nor in the European Union are there any important macroeconomic reports planned.
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 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 - www.instaforex.com