EUR/USD – 1H.
Good day, traders! On March 30, the growth of the European currency was replaced by a fall. So far, the "bullish" mood of most traders remains due to the upward trend line. However, on the morning of March 31, the pair's quotes worked out this line, so now the euro/dollar pair will either perform a close under this line, which will change the mood of traders to "bearish", or perform a rebound with a reversal in favor of the EU currency and a resumption of growth. This dilemma will be resolved in the next few hours. In general, the situation on world markets remains very difficult. According to the latest information, the number of cases of COVID-2019 virus in the world is almost 800,000. Thus, it is not possible to reduce the growth rate of the epidemic. The United States and Italy are most affected by the epidemic. These are two countries in the world where the number of infected people exceeds 100,000. Will traders want to invest in the dollar at this scale of the epidemic in America?
EUR/USD – 4H.
As seen on the 4-hour chart, the EUR/USD pair performed a reversal in favor of the US dollar near the corrective level of 61.8% (1.1167), but did not reach it. The bearish divergence of the CCI indicator is very weak, but it also helped to turn the pair in favor of the dollar. As a result, the process of falling quotes began in the direction of the corrective level of 38.2% (1.0964), from which the rebound was already made earlier. From any level of correction, a rebound can be made in the near future. However, the trend line on the hourly chart remains more eloquent.
EUR/USD – Daily.
On the daily chart, the picture for the EUR/USD pair is identical to the picture on the 4-hour chart. The pair's quotes performed a reversal in favor of the US currency and anchored under the corrective level of 50.0% (1.1068). Thus, the process of falling quotes can be continued in the direction of the next Fibo levels of 38.2% (1.0965) and 23.6% (1.0840).
EUR/USD – Weekly.
On the weekly chart, the pair has a high chance of continuing the growth process, since the breakdown of the lower border of the "narrowing triangle" turned out to be false. Thus, it can be considered a rebound, not a breakdown. In the future, the euro/dollar pair has the opportunity to perform growth to the level of 1.1600.
Overview of fundamentals:
On March 30, there were few important and interesting news in the United States and the European Union. The consumer price index in Germany fell to 1.4% y/y, but this is not an event that traders are now ready to work out. The entire information background is now reduced to statements by the US government and its various officials regarding the current situation with the coronavirus.
News calendar for the United States and the European Union:
Germany - unemployment rate (seasonally adjusted) (09:55 GMT).
Germany - change in the number of unemployed (09:55 GMT).
EU - consumer price index (11:00 GMT).
US - consumer confidence indicator (16:00 GMT).
On March 31, there will again be few important economic reports. German unemployment data, EU inflation, and US consumer confidence. All these economic reports would have aroused close interest before the epidemic, but now they are unlikely to be of great importance to Forex traders.
COT report (Commitments of Traders):
The new COT report is out! In general, major market players got rid of extra contracts during the analyzed week, that is, activity fell. In general, major market players who are trying to make money on exchange rate changes got rid of short-contracts. That is, speculators. However, companies that hedge their risks also closed short contracts, along with long contracts. The total number of active contracts remains in favor of short. Moreover, it is the hedgers who now have on their hands of the total volume of contracts. The upward prospects for the euro currency remain. Thus, nothing prevents the euro/dollar pair from performing a correction and then resuming the growth process.
Forecast for EUR/USD and recommendations for traders:
I recommend staying in the purchases of EUR/USD pair until the quotes close below the trend line on the hourly chart. The goals are 1.1167 and 1.1294. Or open new purchases if the rebound from the trend line is performed. I recommend opening sales of the euro currency after closing quotes under the trend line on the hourly chart since this line looks the most convincing right now. The goals are 1.0964 and 1.0840.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
