From the point of view of a comprehensive analysis, you can see a reversal, where the quote managed to recover more than half relative to the correctional movement, and now let's talk about the details.
The past trading day was held in the wake of the recovery process, where half of the corrective move from the mirror level of 1.2350 was won back by market participants. By analyzing the fluctuation in detail, we can see that the area of 1.2500/1.2540 became the driver for short positions, where a slowdown a day before recovery took place.
The recovery process that takes place in the region of the range of 1.2770 lasts exactly two weeks, where the followers of the upward development have not been able to change the range of fluctuation from 1.2150 // 1.2350 // 1.2620 to 1.2770 / / 1.3000 // 1.3300. Having a corrective movement from an average level of 1.2350, says one thing, that is, the primary range was still relevant, so it remains, the subsequent development within its borders is only a point in time.
Analyzing the past trading day every minute, we can fix that a round of short positions arose from 11:00 UTC+00 and lasted until the end of the trading day. If we analyze the dynamics of the currency market, it will be seen that in this case, there was a widespread strengthening of the US dollar.
Regarding development theories, there is a fluctuation within the range of 1.2150 // 1.2350 // 1.2620 in terms of prospects for the coming weeks, but in terms of our strategy, we will continue to pursue local operations, starting from the current trading candles.
In terms of volatility, an indicator is consolidated above the average daily 128 against 126 points, which means that speculative excitement is still preserved in the market, which leads to intense dynamics. It should be noted that the speculative operations ratio is high everywhere in the currency market, which means that the emotional component of the market is still unstable.
As discussed in the previous review, traders were ready for a downward move, but the main prospect was and is the level of 1.2350, thus it is still possible to open short positions.
Considering the trading chart in general terms (the daily period), you can see that even ultra-high market activity could not violate the integrity of the global downward trend, thereby the market continues to move downward.
The news background of the past day did not have the attention of statistics on Britain and the United States, thereby the market will continue to monitor the external background, as well as the emotional mood of speculators.
In terms of the general informational background, work is continuing on a trade agreement on relations between Britain and Europe after Brexit, where there is some progress in the negotiations, but at the same time there are a lot of controversial issues that frighten already frightened investors.
In turn, the news appeared that Japan is pushing the United Kingdom in terms of concluding a trade deal with each other. So, Tokyo gives England six weeks after Brexit to conclude the first deal, which will be the fastest trade negotiations in history and the first for Britain in more than 40 years. It is worth considering that quickly does not mean good, but this means that you have to sacrifice something, which even more scares investors.
"There is so little time that both sides will need to limit their ambitions," warned Hiroshi Matsuura, Tokyo's chief negotiator.
Today, in terms of the economic calendar, we have the final data on the United States GDP for the first quarter, where the finish indicator should become worse than the first estimate, displaying a decline to 5.0%. Of course, this is a blow to the US economy, which puts pressure on the US dollar, but the decline in GDP was expected for the market and I'm not sure if there will be a negative reaction if the data are confirmed. At the same time, they will publish data on orders for durable goods in the United States today, which will grow by 8.5%, as well as weekly indicators on the labor market, which will reflect a sluggish, but still recovery.
Thus, the US dollar still has a chance for further growth.
Further development
Analyzing the current trading chart, we can see price fluctuations within the range of 1.2400/1.2435, which will definitely have a local phenomenon in the market, as speculative excitement simply will not make it possible to stand in one place. The development of quotes will adhere to the range 1.2150 // 1.2350 // 1.2620, where in this case, the downward move is being considered.
It can be assumed that we will see a temporary pullback in the direction of 1.2470 at the beginning of the day, but then closer to the US trading session, a further price decline towards the pivot point of 1.2350 is likely.
Based on the above information, we derive trading recommendations:
- Consider buy positions above 1.2440, towards 1.2470.
- Consider sell positions below 1.2400, with the prospect of a move to 1.2350
Indicator analysis
Analyzing a different sector of time frames (TF), we see that the indicators of technical tools on hourly and daily periods signal sales, by focusing the price higher by a value of 1.2400.
Volatility per week / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, calculated for the Month / Quarter / Year.
(June 25 was built taking into account the time of publication of the article)
The volatility of the current time is 37 points, which is 70% lower than the average daily indicator, but everything is just beginning. It can be assumed that amid the news background, as well as speculative excitement, volatility will increase to at least 100 points.
Key levels
Resistance Zones: 1.2500; 1.2620; 1.2770 **; 1.2885 *; 1.3000; 1.3170 **; 1.3300 **; 1.3600; 1.3850; 1.4000 ***; 1.4350 **.
Support Zones: 1.2350 **; 1.2250; 1.2150 **; 1.2000 *** (1.1957); 1.1850; 1.1660; 1.1450 (1.1411); 1.1300; 1.1000; 1.0800; 1.0500; 1.0000.
* Periodic level
** Range Level
*** Psychological level
**** The article is built on the principle of conducting a transaction, with daily adjustment
