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EUR/USD 5M
The EUR/USD pair did not show anything on Thursday. In principle, all articles from this week could be combined into one, since nothing changes every day. The pair continues to pass 30-40 points every day, while being mainly in the horizontal channel. In principle, the chart clearly shows that both linear regression channels are directed almost sideways and have practically merged with each other at the same time. Thus, the conclusion is obvious - a flat. We have said earlier that a flat, in principle, is by far the best time to trade. But here traders come to the aid of technical analysis, which in this case worked perfectly and did not form a single signal during the day. This is very good, as there could have been another variant in which the pair would have been trading near a certain level or line all day, forming false signals in batches. However, yesterday there was no such thing. Only two more or less significant reports were published on Thursday. The first is industrial production in the European Union, the second is the applications for unemployment benefits in the United States. Needless to say, neither the first nor the second caused any reaction from the markets? Thus, flat, lack of reaction to weak reports, weak volatility. Being out of the market was the best solution.
Overview of the EUR/USD pair. August 13. The Fed is racing towards the end of the QE program.
Overview of the GBP/USD pair. August 13. British scientists: herd immunity against coronavirus is a myth.
EUR/USD 1H
The technical picture on the hourly timeframe is not as eloquent. The weakness of movement of the last days is clearly visible. Formally, the downward trend for the EUR/USD pair persists, since the price had previously overcome the upward trend line. However, as we have said more than once, the movements are very weak right now. The technical picture on the hourly timeframe does not change at all, and in the last few days the price has not even crossed a single line or level. On Friday, we still recommend trading from important levels and lines. The nearest important levels at this time are 1.1704, 1.1756, 1.1852, 1.1894, as well as the Senkou Span B (1.1826) and Kijun-sen (1.1760) lines. The Ichimoku indicator lines can change their position during the day, which should be taken into account when looking for trading signals. Signals can be rebounds or breakthroughs of these levels and lines. Do not forget about placing a Stop Loss order at breakeven if the price moves 15 points in the right direction. This will protect you against possible losses if the signal turns out to be false. No macroeconomic reports either in the US or the European Union on August 13. The only more or less significant report of the day is the Consumer Sentiment Index from the University of Michigan in the US. However, waiting for the markets to react to it is a waste of time. Most likely, today we are also expecting weak movements in the channel as close as possible to the sideways one.
We also recommend that you familiarize yourself with the forecast and trading signals for the GBP/USD pair.
COT report
The EUR/USD pair increased by 70 points during the last reporting week (July 27 – August 2). At the same time, the Commitment of Traders (COT) report for this week showed minimal changes in the mood of major players. During this period of time, the "non-commercial" group closed 3,000 buy contracts (longs) and 500 sell contracts (shorts). Thus, the net position for non-commercial traders decreased by another 2,500, and the mood of major players became even less bullish. Less bullish and not more bearish because at the moment, professional players still have more open buy contracts than those for selling. Thus, the global upward trend, which we talk about very often, can still resume at any moment. Pay attention to the chart above. At the moment, the quotes have not even been able to fall to their previous local low on the 24-hour timeframe. That is, at the moment it is not even possible to say that a new downward trend has begun. Everything still looks as if the pair is simply correcting against a long-term upward trend. And this correction may end in the near future. We remind you that the US currency continues to be negatively affected by the factor of the Federal Reserve's injection of billions and trillions of dollars into the economy, which inflates the money supply in the country and provokes an increase in inflation. Thus, the dollar may depreciate due to this factor, and the European currency – due to the factor of sales by its major players. The question is which of the currencies will become cheaper faster. So far, both indicators show very well what is happening with the euro/dollar pair. As you can see, when the pair decreases, the net position of major players also decreases (the second indicator), and vice versa.
Explanations for the chart:
Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.
Support and resistance areas are areas from which the price has repeatedly rebounded off.
Yellow lines are trend lines, trend channels and any other technical patterns.
Indicator 1 on the COT charts is the size of the net position of each category of traders.
Indicator 2 on the COT charts is the size of the net position for the non-commercial group.
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