EUR/USD: trading plan for the American session on April 4 (analysis of morning deals)
April 4, 2023 12:24 pm
In my morning forecast, I paid close attention to level 1.0927 and recommended making entry selections there. Let’s analyze the 5-minute chart to see what happened. At this level, growth and the development of a false collapse set off a sell signal for the euro, but as of this writing, there hasn’t been a significant drop, and it’s unlikely that one will happen. The technical picture still needs to be updated over the second half of the day.
To initiate long positions on the EUR/USD, you must:
Since there was no pressure on the euro after the release of producer price data for the eurozone, which was slightly better than economists’ estimates on an annualized basis, a bullish scenario is likely to happen in the afternoon. A decrease and the formation of a false collapse in the support area of 1.0881, where the moving averages are already present and favoring the bulls, will be the optimum strategy for purchasing the euro. With the release of favorable statistics on the United States, there is a possibility of a decline. However, it is unlikely that the Bureau of Labor Statistics and the number of manufacturing orders would experience positive changes. What FOMC member Lisa D. Cook will say is much more interesting. A false breakout at 1.0881 will generate a buy signal, continuing the euro’s rise with a reversal at 1.0927. A breakout and a top-down test of this level would provide an extra entry point for long positions with a profit target of 1.0975. The area at 1.1002 remains the farthest target. If EUR/USD declines and there are no buyers at 1.0881, which is doubtful in such a bull market, pressure on the euro will return, and 1.0833 will be reached. Only the emergence of a false collapse will serve as an indication to purchase the euro. I will open long positions immediately for a rebound from the day’s low of 1.0792, or even lower – around 1.0748, with a 30-point intraday correction target.
To establish short positions on the EUR/USD, you must:
The bears did their best at 1.0927, but it was insufficient. The lack of key participants at this level can lead to a new wave of EUR/USD growth; therefore, short positions should be approached with extreme caution. The ideal situation for opening new short positions is the formation of a false collapse at 1.0927, similar to what I stated previously, which can occur only after the release of good economic data from the United States. This will cause the pair to fall to their nearest support level of 1.0881. A breakdown and retest of this area will intensify the pressure on the pair, pushing the euro to a low of 1.0833. Fixing below this range will allow entry to 1.0792, although this is quite unusual. I will fix the profit there. In the event of an upward movement of EUR/USD during the US session and the lack of bears at 1.0927, which is more likely given how euro sellers reacted to inflation data in the first half of the trading day, I recommend delaying short positions to 1.0975. Selling is permitted only after a failed consolidation. I will begin short positions immediately in anticipation of a rebound from the maximum of 1.1002 with the target of a 30-35 point decline.
The Commitment of Traders (COT) report for March 28 revealed a rise in both long and short positions. Given that nothing noteworthy occurred last week and the figures on the price index of personal consumption expenditures in the United States were not as favorable as experts had anticipated, the Federal Reserve will likely raise interest rates at its next meeting. Yet, the aggressive European Central Bank, which will continue to raise interest rates aggressively, enables buyers of the European currency to act more aggressively with each significant loss of the euro versus the dollar. Aside from the US unemployment data, there is nothing noteworthy this week. Therefore, the euro has a good chance of surpassing the highs of March. According to the COT data, long non-commercial positions increased by 7,093 to 222,918, while short non-commercial positions increased by 6,910 to 77,893. The total non-commercial net position rose from 144,848 to 145,025 toward the week’s conclusion. The weekly ending price increased from 1.0821 to 1.0896.
Signals from indicators:
Moving Averages
Trade occurs above the 30-day and 50-day moving averages, indicating a lateral market.
The author considers the period and prices of moving averages on the hourly chart H1, which differ from the standard definition of daily moving averages on the daily chart D1.
Bollinger Bands
In the event of a decline, the indicator’s lower limit near 1.0881 will act as support.
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 speculative traders, such as individual traders, hedge funds, and large institutions, use the futures market for speculative purposes and to meet certain requirements.
Long non-commercial positions represent the total long open position of non-commercial traders.
Short non-commercial positions represent the total short open position of non-commercial traders.
Total non-commercial net position is the difference between the short and long positions of non-commercial traders.
The material has been provided by InstaForex Company – www.instaforex.com
In my morning forecast, I paid close attention to level 1.0927 and recommended making entry selections there. Let’s analyze the 5-minute chart to see what happened. At this level, growth and the development of a false collapse set off a sell signal for the euro, but as of this writing, there hasn’t been a significant drop, and it’s unlikely that one will happen. The technical picture still needs to be updated over the second half of the day.
To initiate long positions on the EUR/USD, you must:
Since there was no pressure on the euro after the release of producer price data for the eurozone, which was slightly better than economists’ estimates on an annualized basis, a bullish scenario is likely to happen in the afternoon. A decrease and the formation of a false collapse in the support area of 1.0881, where the moving averages are already present and favoring the bulls, will be the optimum strategy for purchasing the euro. With the release of favorable statistics on the United States, there is a possibility of a decline. However, it is unlikely that the Bureau of Labor Statistics and the number of manufacturing orders would experience positive changes. What FOMC member Lisa D. Cook will say is much more interesting. A false breakout at 1.0881 will generate a buy signal, continuing the euro’s rise with a reversal at 1.0927. A breakout and a top-down test of this level would provide an extra entry point for long positions with a profit target of 1.0975. The area at 1.1002 remains the farthest target. If EUR/USD declines and there are no buyers at 1.0881, which is doubtful in such a bull market, pressure on the euro will return, and 1.0833 will be reached. Only the emergence of a false collapse will serve as an indication to purchase the euro. I will open long positions immediately for a rebound from the day’s low of 1.0792, or even lower – around 1.0748, with a 30-point intraday correction target.
To establish short positions on the EUR/USD, you must:
The bears did their best at 1.0927, but it was insufficient. The lack of key participants at this level can lead to a new wave of EUR/USD growth; therefore, short positions should be approached with extreme caution. The ideal situation for opening new short positions is the formation of a false collapse at 1.0927, similar to what I stated previously, which can occur only after the release of good economic data from the United States. This will cause the pair to fall to their nearest support level of 1.0881. A breakdown and retest of this area will intensify the pressure on the pair, pushing the euro to a low of 1.0833. Fixing below this range will allow entry to 1.0792, although this is quite unusual. I will fix the profit there. In the event of an upward movement of EUR/USD during the US session and the lack of bears at 1.0927, which is more likely given how euro sellers reacted to inflation data in the first half of the trading day, I recommend delaying short positions to 1.0975. Selling is permitted only after a failed consolidation. I will begin short positions immediately in anticipation of a rebound from the maximum of 1.1002 with the target of a 30-35 point decline.
The Commitment of Traders (COT) report for March 28 revealed a rise in both long and short positions. Given that nothing noteworthy occurred last week and the figures on the price index of personal consumption expenditures in the United States were not as favorable as experts had anticipated, the Federal Reserve will likely raise interest rates at its next meeting. Yet, the aggressive European Central Bank, which will continue to raise interest rates aggressively, enables buyers of the European currency to act more aggressively with each significant loss of the euro versus the dollar. Aside from the US unemployment data, there is nothing noteworthy this week. Therefore, the euro has a good chance of surpassing the highs of March. According to the COT data, long non-commercial positions increased by 7,093 to 222,918, while short non-commercial positions increased by 6,910 to 77,893. The total non-commercial net position rose from 144,848 to 145,025 toward the week’s conclusion. The weekly ending price increased from 1.0821 to 1.0896.
Signals from indicators:
Moving Averages
Trade occurs above the 30-day and 50-day moving averages, indicating a lateral market.
The author considers the period and prices of moving averages on the hourly chart H1, which differ from the standard definition of daily moving averages on the daily chart D1.
Bollinger Bands
In the event of a decline, the indicator’s lower limit near 1.0881 will act as support.
Description of indicators
The material has been provided by InstaForex Company – www.instaforex.com
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