4-hour timeframe
Technical details:
The senior linear regression channel: direction - down.
The younger linear regression channel: direction - up.
Moving average (20; smoothed) - down.
CCI: -83.4453
The currency pair EUR / USD on Thursday, January 3, is trying to recover slightly after a strong fall the day before. It is still difficult to say what exactly caused such a strong strengthening of the American currency or the fall of the euro and the pound. In our opinion, this is just a reaction of traders at the beginning of the new year, since at the end of 2018, there was a strengthening of the euro and the pound, which you would not call anything other than corrective. The closing of "dollar" positions could also be connected with the desire to fix part of the profit before the end of the year. Thus, on the first trading day of the new year, new purchases of the US dollar followed, which, in our opinion, will not last long. New good reasons for the growth of the US currency is not. Moreover, there is no macroeconomic information that could provoke a strong increase in the US dollar. There is no new information on Brexit, not to mention the macroeconomic reports. In the United States today, two relatively important reports are being issued, the business activity index in the ISM production sector for December and the ADP report on changes in the number of workers in the private sector. Both indicators are expected to deteriorate compared with the previous period. At the beginning of today, the Euro currency is already showing growth, if the American statistics disappoint, it may increase.
Nearest support levels:
S1 - 1.1353
S2 - 1.1322
S3 - 1.1292
Nearest resistance levels:
R1 - 1.1383
R2 - 1.1414
R3 - 1.1444
Trading recommendations:
The EUR / USD currency pair has fixed below the MA. Thus, short positions are relevant now, but Heikin Ashi dyed the last bars in purple. Therefore, it will be possible to open new sell-positions after turning this indicator down with the target of 1.1322.
Purchase orders will become again relevant not earlier than the price fixing above the moving average with the target of 1.1444. In this case, the initiative again goes into the hands of bulls.
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 - www.instaforex.com