4-hour timeframe

Amplitude of the last 5 days (high-low): 84p - 86p - 131p - 74p - 133p.

The average amplitude for the last 5 days is 102p (90p).

Optimism swept traders on Friday, June 29. Inflation in Europe for the first time in a long time exceeded the forecasts of experts and amounted to "whole" 2.0% with a forecast of 1.9%. Traders, against the backdrop of European purchases that started at night, responded with new longs, which allowed the euro to gain a little more. At the same time, the basic consumer price index, which does not take into account, for example, the change in energy prices, showed much more modest growth dynamics, only 1.0% y / y. We believe that this indicator is of greater importance since the rise in oil prices often also causes a rise in prices for all goods in the production of which oil is used. Therefore, it is unlikely that traders will remain optimistic for a long period of time. At the same time, the personal expenses of the American population slightly disappointed traders, as its growth was only 0.2% in May, against the forecast of 0.4% and the April value of 0.6%. This means that Americans have a stronger propensity to save, which is unlikely to please the Fed. However, against the backdrop of the trade war that the US continues to unleash on all fronts, this inclination of citizens is well founded. Uncertainty, which is linked to the future of the US economy, in the light of trade duties on a number of goods, makes Americans look with caution in the near future. Moreover, all countries against which Trump introduces trade restrictions, try to respond "in tone." Most of all, of course, China, which, though dependent on the export of goods to the US, still has a lot of other markets. And not to strike back at the States would be a manifestation of weakness. Question: what methods will the PRC want to answer? There are a lot of options, from the introduction of reciprocal trade restrictions to the sales of US government bonds, which China actively bought in recent years, which could lead to a collapse in the American stock market.

Trading recommendations:

For the pair EUR / USD, it is recommended to consider long positions with a target of 1,1722 if the MACD indicator on the current bar does NOT turn down. This will mean that the initiative remains in the hands of the bulls.

Sell-positions are recommended to be opened if MACD will turn down, and bears will be able to gain a foothold below the critical line. In this case, bears can resume the formation of a downtrend with the first targets of 1.1588 and 1.1568.

In addition to the technical picture, one should also take into account the fundamental data and the time of their release.

Explanations to the illustration:

Ichimoku Indicator:

Tenkan-sen is a red line.

Kijun-sen is a blue line.

Senkou Span A is a light brown dotted line.

Senkou Span B - a light purple dotted line.

Chinkou Span is a green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

Redline and histogram with white bars in the indicator window.