The euro/dollar currency pair showed high volatility of 84 points for the last trading day, as a result of which we saw the return of the quote to the base point of the week. From technical analysis, we see that the psychological level of 1.1000 played the role of support again, slowing down the quote and returning us to the resistance level of 1.1080, where it all began. If we analyze in detail the past movement, we will see that the structure of the candles carried a pulse, inertial character in the time interval of 08:00-17:00 London time, which reflects not just a technical rebound but the foundation of external factors.

As discussed in the previous review, speculators considered the scenario of a rebound from the psychological level of 1.1000 but no one expected such a strong change in the quote. In any case, the entry point was both at the time of the slowdown within the level, and at the time of the price move, the coordinates were specified. Considering the trading chart in general terms (daily period), we see not just a corrective move, but a kind of ambiguity, expressed in the divergence of interests. The resistance point remains in the range of 1.1080/1.1115. The fulcrum of the main course is located at 1.0926.

The news background of the day contained data on industrial production in the United States, where there was a slowdown from 0.5% to 0.4%, but, according to preliminary forecasts, expected a stronger decline to 0.2%. The market reaction to the statistics was because the news was in the background. What did the market react? – Federal Reserve's action. The Federal Reserve for the first time since 2008 entered the repo market due to the catastrophic jump in the repo rate on the interbank market from 2.5% to 10.0%. The financial system of the United States faced an acute deficit of dollars, which effectively paralyzed the interbank market, for the reason that the Fed began to urgently pour dollars. The amounts of injections are staggering, and so, the first gulf of $53.15 billion, the second even more than $75 billion is scheduled for Wednesday, and this, gentlemen, for more than $128 billion. I think now, the question of the jump in the quotation is removed and a new question arises, was this a show on the eve of a reduction in the refinancing rate or the idea of the great equalizers deeper?

Today, in terms of the economic calendar, we had data on inflation in the eurozone, where the figures were confirmed at the same level of 1.0%. The key event of the day and week remains in the form of a meeting of the Federal Committee on Open Market Operations, where at 19:00 London time, the decision on the refinancing rate will be announced, and at 19:30 London time, everyone's beloved Jerome Powell will speak. Preliminary forecasts and expectations of many experts agree that the rate will still be reduced from 2.25% to 2.00%, which will put pressure on the US dollar and, as a fact, on the local growth of the euro. In anticipation of the event, it is advised to monitor the news feed, in particular, Bloomberg, as well as Twitter of Mr. Trump (@realDonaldTrump), who can traditionally contribute to the Fed and in particular, Jerome Powell.

Further development

Analyzing the current trading chart, we see that the recovery of the quotation was not long in coming, and this is understandable, local overheating still plays a role in the market. Speculators, in turn, have already managed to ride on the recovery process, now there is a monitoring of what is happening on the eve of an important event, as flights are still expected, and if the rate is still reduced, the current recovery process can play into the hands of speculators for the most profitable entry into the market.

It is likely to assume that in the pre-FOMC meeting, a temporary slowdown is possible, where, depending on the incoming information, jumps will take place and already at the time the rate is announced (19:00 London time), the main movement will occur. In this case, you need to carefully and, most importantly, soberly assess the incoming information background, so if at the last moment, the scales outweigh the decision to leave the rate at the current level, then what kind of surge will occur in the market, believe me, it will be greater than in the case of an increase in the rate.

Based on the above information, we will derive trading recommendations:

• We consider the buy positions in two versions: the first is considered relative to the current points and a possible slowdown, it is advised to wait for the time interval 18:00-19:00 London time, there may be a slowdown, with respect to which we will consider the entry points; the second option considers the entry above the current resistance point of 1.1080/1.1115. The prospect of a move towards 1.1180.

• We consider positions for sale in a step course at 1.1025 – 1.1000. Further move after fixing the price below 1.1000 (not a puncture), with the prospect of movement 1.0926. The ideal option while maintaining the refinancing rate.

Technical analysis

Analyzing different sector timeframes (TF), we see that the indicators in the short term are variably inclined to decrease due to the recovery process. Intraday and mid-term indicators are still showing upward interest. When setting up an indicator analysis, it is worth considering that with a strong information and news background, the indicators can be volatile.

Volatility per week / Measurement of volatility: Month; Quarter; Year

Measurement of volatility reflects the average daily fluctuation, calculated for the Month / Quarter / Year.

(September 18 was built taking into account the time of publication of the article)

The volatility of the current time is 39 points. It is likely to assume that due to the meeting of the Federal Committee on Open Market Operations and the announcement of the refinancing rate, volatility is expected to be high.

Key levels

Resistance zones: 1.1100 ** ;1.1180 *; 1.1300 **; 1.1450; 1.1550; 1.1650 *; 1.1720 **; 1.1850 **; 1.2100

Support zones: 1.1000 ***; 1.0850 **; 1.0500 ***; 1.0350 **; 1.0000 ***.

* Periodic level

** Range level

*** Psychological level

**** The article is built on the principle of conducting a transaction, with daily adjustments.