EUR/USD 5M

The EUR/USD pair was trading very sluggishly on Monday. Given the fact that yesterday was a public holiday in the United States, it is not surprising that the pair showed one of the lowest levels of volatility in recent weeks. In principle, there was nothing special to analyze even on Monday. The pair was trading sideways for most of the day, so the technical picture has not changed in any way. There were no macroeconomic statistics, no fundamental events either. Thus, the pair continues to stay close to its 20-year lows and continues to aim for their renewal. The fact that the euro can't even properly correct leads to the conclusion that new lows are inevitable. So far, we do not see factors that could raise the demand for the euro. And it should also be remembered that the demand for the US dollar remains very high.

As mentioned above, there were no trading signals on Monday. The pair did not even approach important levels and lines during the day, so there was not even a theoretical opportunity to open a deal. It remains only to wait for the American traders to return to the market and the price will again move more actively. After all, yesterday the volatility was less than 50 points.

COT report:

The latest Commitment of Traders (COT) reports on the euro over the past six months have raised a huge number of questions. The chart above clearly shows that they showed a blatant bullish mood of professional players, but at the same time, the euro was falling at the same time. At this time, the situation has changed a bit, and not in favor of the euro. If earlier the mood was bullish, but the euro was falling, now the mood has become bearish and... the euro is falling. Therefore, for the time being, we do not see any grounds for the euro's growth, because the vast majority of factors remain against it. During the reporting week, the number of long positions decreased by 6,100, and the number of shorts in the non-commercial group decreased by 11,100. Accordingly, the net position slightly increased by 5,000 contracts. However, the mood of major players still remains bearish. From our point of view, this fact very eloquently indicates that at this time even professional traders do not believe in the euro. The number of longs is lower than the number of shorts for non-commercial traders by 11,000. Therefore, we can state that not only the demand for the US dollar remains high, but also the demand for the euro is quite low. This may lead to a new, even greater fall of the euro. In principle, over the past few months or even more, the euro has not been able to show even a tangible correction, not to mention something more. The highest upward movement was about 400 points.

We recommend to familiarize yourself with:

Overview of the EUR/USD pair. July 5. The euro is waiting for a miracle, but it is unlikely to wait.

Overview of the GBP/USD pair. July 5. Geopolitics continues to deteriorate, which is not a plus for the pound and the euro.

Forecast and trading signals for GBP/USD on July 5. Detailed analysis of the movement of the pair and trading transactions.

EUR/USD 1H

It is clearly seen on the hourly timeframe that the pair continues to be below all the lines of the Ichimoku indicator. Thus, the trend remains downward, but the bears face big problems in surpassing the level of 1.0366. In principle, it is not surprising that traders are not eager to continue to sell the euro around 20-year lows. On the other hand, the fundamental and geopolitical backgrounds remain very difficult for the euro. We highlight the following levels for trading on Tuesday - 1.0340-1.0366, 1.0485, 1.0579, 1.0637, as well as Senkou Span B (1.0524) and Kijun-sen (1.0455). Ichimoku indicator lines can move during the day, which should be taken into account when determining trading signals. There are also secondary support and resistance levels, but no signals are formed near them. Signals can be "rebounds" and "breakthrough" extreme levels and lines. Do not forget about placing a Stop Loss order at breakeven if the price has gone in the right direction for 15 points. This will protect you against possible losses if the signal turns out to be false. The European Union will release a completely minor second estimate of the index of business activity in the services sector. It is the second estimate that does not matter to the market, since it rarely differs from the first. There will not even be such a report in the US, so today we can witness another flat and low volatility day.

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.