EUR/USD. May 17. Trading system "Regression Channels". Inflation in the European Union may cause a new fall in the euro

4-hour timeframe


Technical data:

The upper linear regression channel: direction – down.

The lower linear regression channel: direction – sideways.

The moving average (20; smoothed) – down.

CCI: -127.3548

There were no important macroeconomic publications yesterday. However, the EUR/USD pair made another unsuccessful attempt to change the trend to an upward one, rebounded from the MA and immediately resumed its downward movement, but it could not gain a foothold below the Murray level of "-1/8" - 1.1169. Thus, the pair can start another round of correction and make another attempt to start an upward trend. Volatility on the pair remains weak, and there is no pronounced trend. The main newsmaker now remains Donald Trump. Its trade conflicts with China and the European Union attract the attention of market participants. However, at the same time, we cannot say that traders zealously work out information on these topics. Rather, these data are just interesting to market participants. Trump replaced anger at the mercy of the European automotive industry and postponed the possible introduction of duties on imports of products in this sector for 6 months. Nevertheless, it did not really help the euro Thus, we continue to insist that there is no fundamental background for the medium and long-term strengthening of the euro. This means that the euro can expect a maximum of small upward corrections, but the downward trend remains. Today, the European Union will publish an inflation report for April. The forecast is +1.7% y/y. Any value below this will help the dollar continue to rise in price.

Nearest support levels:

S1 – 1.1169

S2 – 1.1108

Nearest resistance levels:

R1 – 1.1230

R2 – 1.1292

R3 – 1.1353

Trading recommendations:

The EUR/USD currency pair resumed its downward movement and fulfilled the level of 1.1169. Thus, sell orders remain relevant to the target of 1.1108 if the pair manages to overcome the level of 1.1169.

It is recommended to consider trading for an increase in the pair with extreme caution and small lots not earlier than fixing the price above the moving average line and the level of 1.1230 with the first goal of 1.1292. The intermediate target is 1.1260.

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

Explanation of illustrations:

The upper linear regression channel – the blue line of the unidirectional movement.

The lower linear regression channel – the purple line of the unidirectional movement.

CCI – the 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.

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

The material has been provided by InstaForex Company -