The EUR/USD currency pair continued its downward movement on Wednesday despite everything. Interestingly, these days, when the euro currency is flying down, there are practically no macroeconomic and fundamental events. Yes, ECB President Christine Lagarde gave a speech yesterday, and the day before yesterday there was a report in the United States on orders for long-term goods, which was once considered quite strong, but what has changed? The euro currency, as it fell, is falling. We have already said in recent articles that the factors that provoked the fall of the euro currency in recent months remain unchanged. The macroeconomic and geopolitical situation for the European currency is not improving, so why should we expect the growth of this currency now? Of course, the fall of the euro will not last forever. Sooner or later, a technical correction will begin, which can range from 400 to 800 points, because the downward trend has been going on for a year and a half, respectively, and the correction should be proportionate. However, if you pay attention only to the "foundation" and "macroeconomics" of geopolitics, it is very difficult now to imagine what can help the euro to start growing against the dollar.By the way, almost all the news of the last few days somehow indicates a lack of hope for de-escalation of the conflict. Negotiations between Kyiv and Moscow have stopped, although there are no official statements about the failure. Kyiv has threatened Moscow that if Mariupol falls or an independence referendum is held in the Kherson region, Ukraine will withdraw from any further negotiations. And now these words no longer look like an empty threat, since Ukraine is now backed by the entire Western world, which is happy to supply weapons, humanitarian aid, and money. Accordingly, this conflict has long been not "Russia against Ukraine", it has long been a conflict of "Russia against NATO, the EU, the USA, and Ukraine". At the same time, even Australia, Canada, and Japan are helping Ukraine now. Thus, Kyiv is now busy receiving weapons from all over the world and, according to Presidential adviser Alexei Arestovych, in a few weeks, the AFU will launch a counteroffensive, because there will be no situation in 2014 this time. Ukraine will not "freeze" the conflict, it will not just wait until the issue of the annexed lands is resolved in the highest world courts. With such weapons, which are now in the hands of the Armed Forces of Ukraine, Ukraine will go back to take away the entire Donbas and Crimea.
The military conflict may drag on until the end of the year, at least.
By the way, yesterday, information leaked that a personal meeting between Vladimir Zelensky and Vladimir Putin could take place in the near future. It is difficult to say why it is needed at all. In recent weeks, NATO Secretary-General Jens Stoltenberg, the Chancellor of Austria, the President of France, and many other top officials of Europe and the West have gone to meet with Putin. However, no progress has been made. Accordingly, why do we need a meeting of the presidents of Ukraine and the Russian Federation at all, if Moscow itself has repeatedly stated that the meeting can take place only when the negotiating groups draw up a peace agreement that satisfies both sides, and the presidents will only have to sign it?
We have already said that there will be no peace agreement. At least for one reason - Crimea and Donbas. Russia will not give up these lands now, and Ukraine will not give up them either, especially feeling the support of the whole world in this matter. The Kremlin did not expect that half the world would stand for Ukraine, so this conflict did not go according to plan from the very first day. If there was a plan at all. And now it is completely unclear how to get out of this conflict. Already we can say that you can't rewind time and change anything. The European Union and Russia continue to sever economic and business ties with each other. The United Kingdom and the United States have already imposed all kinds of sanctions on Russia and frozen all the assets they managed to find. Weapons flow into Ukraine like a river. And no one wants to concede in negotiations. Russia simply cannot back down, so it does not work out, and Ukraine, feeling that every day it has more and more weapons, is no longer going to conduct peace negotiations on Moscow's terms.
The average volatility of the euro/dollar currency pair over the last 5 trading days as of April 28 is 111 points and is characterized as "high". Thus, we expect the pair to move today between the levels of 1.0446 and 1.0668. The upward reversal of the Heiken Ashi indicator signals the beginning of an upward correction.
Nearest support levels:
S1 – 1.0498
Nearest resistance levels:
R1 – 1.0620
R2 – 1.0742
R3 – 1.0864
Trading recommendations:
The EUR/USD pair continues to move down. Thus, now it is necessary to stay in short positions with targets of 1.0498 and 1.0446 until the Heiken Ashi indicator turns upwards. Long positions should be opened with a target of 1.0864 if the price is fixed above the moving average line.
Explanations of the illustrations:
Linear regression channels - help to determine the current trend. If both are directed in the same direction, then the trend is strong now.
Moving average line (settings 20.0, smoothed) - determines the short-term trend and the direction in which trading should be conducted now.
Murray levels - target levels for movements and corrections.
Volatility levels (red lines) - the likely price channel in which the pair will spend the next day, based on current volatility indicators.
CCI indicator - its entry into the oversold area (below -250) or into the overbought area (above +250) means that a trend reversal in the opposite direction is approaching.
