To open long positions on EURUSD you need:
Yesterday’s reports on Germany and the eurozone kept the bearish sentiment in the market, and a small attempt to restore the euro at the beginning of the US session was only associated with the closing of short positions by speculative players. There are no signs of a reversal of the pair. From February 11 COT reports (Commitment of Traders) there was a sharp increase in short non-profit positions from 242 005 to 255 144, while long non-profit positions remained almost unchanged and increased from 166 925 to 169 475. As a result, non-profit the net position became even more negative from -75,000 to -85,669. All this indicates the prevalence of bearish sentiment in the market. Currently, buyers are fighting for an intermediate level of 1.0795, but I do not recommend opening long positions from it. Only after a decline and the formation of a false breakout in the area of 1.0770, with the confirmation of divergence on the MACD indicator, will it be possible to count on the first major buyers of the euro. Otherwise, long positions are best considered for a rebound from the low of 1.0740, but there is no special faith in it either. A breakthrough and consolidation above the resistance of 1.0825 will be an equally important task for the bulls, since only after that will it be possible to reflect on the topic of building an upward correction in the European currency to the areas of 1.0860 and 1.0886, where I recommend taking profit.
To open short positions on EURUSD you need:
Sellers continue to update annual lows every day, and today the emphasis will be shifted to support 1.0770, a breakthrough of which will only increase pressure on the euro, which will lead to a test of the 1.0740 area and an update of the 1.0711 range, where I recommend taking profits. The bears need to be in time to do this before the minutes are published from the January meeting of the Federal Reserve, although we are unlikely to see anything new in them either. The first signal to sell the euro in the morning will be a return to the level of 1.0795. In case of an upward correction, a good area for opening short positions will be the highs of 1.0825, but it is best to wait until the formation of a false breakout, but I recommend selling EUR/USD immediately for a rebound from the level of 1.0860.
Signals of indicators:
Trade is conducted below 30 and 50 moving averages, indicating that the euro could decline further.
Testing the lower boundary of the indicator at 1.0780 may limit the euro’s fall. A break of the upper level of 1.0825 will lead to a sharp increase in EUR/USD.
Description of indicators
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
- MACD indicator (Moving Average Convergence / Divergence – Moving Average Convergence / Divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
- Bollinger Bands (Bollinger Bands). Period 20
- Non-profit traders are speculators, such as individual traders, hedge funds and large institutions that use the futures market for speculative purposes and meet certain requirements.
- Long nonprofit positions represent the total long open position of nonprofit traders.
- Short nonprofit positions represent the total short open position of nonprofit traders.
- The total non-profit net position is the difference between short and long positions of non-profit traders.
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