EUR/USD 1H.
The euro/dollar pair continued its upward movement on the hourly timeframe of August 17, which began after the rebound from the Kijun-sen and Senkou Span B lines since the macroeconomic and fundamental backgrounds were practically absent on this day, the trading was calm, without sharp and strong movements. The pair reached the resistance area of 1.1886-1.1910 by the end of the trading day, near which its future fate will now be decided. If a rebound occurs from it, then the fall will resume within the side channel of $1.17-$1.19 while aiming for its lower border. The upward trend may resume if buyers finally gather their strength and overcome this area.
EUR/USD 15M
Both channels of linear regression are still directed upwards on the 15-minute timeframe, as the mood of traders did not change on Monday. A new Commitment of Traders (COT) report was released last Friday. According to this report, non-commercial traders reopened Buy-contracts and closed Sell-contracts. Thus, the net position for the "non-commercial" category of traders, which is the most important and significant category of traders, has grown again, this time by 15,000 contracts, which is a high value (5,128 Buy-contracts were opened and 9,681 Sell-contracts were closed). This leads to the conclusion that big traders have not changed their mood at all over the past week. In principle, the same conclusion can be drawn by looking at the chart of the euro/dollar currency pair itself. The pair has been in the side channel since July 27, which is three weeks ago. Thus, we can not even say that the euro has started to fall in price, which would allow us to conclude that the mood of the major players has changed. During all this time, traders managed to adjust the pair by a maximum of 200 points down, which is very little to be reflected in the COT report. Thus, the euro continues to rise in price, and the COT reports show a strengthening bullish mood.
There was no fundamental background for the EUR/USD pair on Monday. Traders had only to reason and analyze common fundamental topics, one of which is the US-China confrontation. According to the latest information, Washington may resort to new methods of pressure on Beijing, including a ban on Chinese banks' access to the international money transfer system centered in New York; restricting the access of Chinese companies to the SWIFT system of international transfers, which is formally Belgian, but according to some sources is subject to Washington; prohibiting any US financial entity from interacting with Chinese companies. Thus, the United States is considering new ways to influence China, which has become the source of the spread of the coronavirus around the world, because of which the American economy suffered the greatest losses. Also, the Chinese side is in no hurry to start talks on the second phase of the trade deal and, according to some reports, does not fully comply with all the agreements under the January agreement. Beyond that, Beijing clearly wants Joe Biden to win the November election, further enraging US President Donald Trump. In general, the confrontation between Beijing and Washington continues to heat up.
Based on the above, we have two trading ideas for August 18:
1) Buyers continue to wait and do not force events. To make new purchases of the euro,you are advised to wait until the price settles above the resistance area of 1.1886-1.1910. Then we will recommend buying the pair with the first target at the resistance level of 1.1958. In this case, the potential Take Profit is about 30 points. The next target is 1.2051, but with current levels of volatility and buying activity, it is not known when this level will be reached.
2) Bears continue to experience big problems and cannot go below the 1.1715 level. We recommend opening sales after breaking through the support area of 1.1702-1.1727 with the first target at the 1.1652 level. Potential Take Profit in this case will be about 30 points. If the price rebounds from the resistance area of 1.1886-1.1910, you can also open shorts with the targets of the Senkou Span B line and the 1.1715 level. In this case, Take Profit is from 60 to 100 points.
Hot forecast and trading signals for the GBP/USD pair.
We also recommend that you study the fundamental background in these articles:
Overview of the EUR/USD pair. August 18. The US dollar has no reason to get more expensive, except for technical reasons. Donald Trump is reducing the gap from Joe Biden by several percent.
Overview of the GBP/USD pair. August 18. Scotland and Northern Ireland are increasingly hinting at their exit from the UK. The British economy will continue to experience problems in 2021.
Explanations for illustrations:
Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.
Support and resistance areas are areas from which the price has repeatedly rebounded off.
Yellow lines are trend lines, trend channels and any other technical patterns.
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