EUR/USD 5M
The EUR/USD pair was trading absolutely typical for a Monday. Quite often, the volatility of movement is very weak on Mondays, and there is no trend. In addition, no important fundamental information or macroeconomic reports today either. At the same time, it even managed to form two signals that could be worked out. But everything about that will be discussed in order. Trading during the evening went about in a very unusual way, since there is usually a flat at night. In our case, though it was not strong, there was still a downward movement, which began around 4-5 o'clock in the morning. It was at this time that the first sell signal was formed, which we would recommend considering. However, since it was still formed at night, it could be skipped. When the European trading session began, the full flat multiplied as soon as the calm began. There was a sideways movement in the channel with a width of 25 points during the rest of the day. It is clear that it was extremely inconvenient to trade in such conditions , but a buy signal was still formed, the price was reached and it rebounded off the Kijun-sen line. At the moment, the price has moved away from the critical line by 15-20 points, so Stop Loss can be moved to breakeven in order not to get unnecessary losses on this deal. By the way, those traders who nevertheless opened sell deals at night at the first signal could have made a profit of about 30 points, since the nearest target (the Kijun-sen line) was worked out. According to the last buy signal, the target is the extremum level of 1.1952.
EUR/USD 1H
We can see that the upward trend line has been broken on the hourly timeframe, so formally there is a downward trend now. However, we also see that the price has already failed to overcome the 1.1911 level twice. Consequently, a new round of upward movement may begin today. In general, now the 1.1911 level and the Kijun-sen line are benchmarks for traders. A final rebound from them indicates a likely round of upward movement. A breakthrough indicates a probable round of downward movement. The European Union will publish an index of business sentiment today, while the United States will release a report on industrial production for February. Traders might show some reaction once these reports are released, albeit small. We do not expect a strong reaction, therefore, technical factors and signals will be of utmost importance today. In general, you are still advised to trade from important levels and lines that are plotted on the hourly timeframe. The nearest levels are 1.1911 and 1.1991, as well as the Kijun-sen line. Signals can be rebounds and breakthroughs. Do not forget about placing a Stop Loss order at breakeven if the price moves 15-20 points in the right direction.
COT report
Recall that the EUR/USD pair fell by 200 points during the last reporting week (March 2-8), which is quite a lot for it. However, in general, even with such a fall, the upward trend is still visible to the naked eye. Thus, so far, there is still no need to talk about an unambiguous change in the trend to a downward one on a global scale. Let us remind you that in recent weeks the mood of major market players has become much more bearish, as the total number of buy contracts (longs) decreased by 20,000, and sell contracts (shorts) increased by 30,000. If earlier there was a threefold difference between these figures, now it is already two times with an advantage of the former. In other words, over the past five weeks, professional traders have begun to believe less that the euro's growth will continue. As for the reporting week, the "non-commercial" group of traders continued the trend of the last weeks. Major players closed 14,000 buy contracts and opened 12,000 sell contracts during this week. Thus, the net position for this group of traders increased immediately by 26,000, and the mood of the group became much more bearish. The latest COT reports speak almost unambiguously in favor of the market sentiment changing to a downward one. Indicators also signal a very likely reversal of the previous trend, as the green and red lines of the first indicator continue to move towards each other. From our point of view, only one global factor can prevent this - this is the factor of a new potential growth of the money supply in the United States by $2 trillion.
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.
Indicator 1 on the COT charts is the size of the net position of each category of traders.
Indicator 2 on the COT charts is the size of the net position for the "non-commercial" group.
