EUR/USD – 1H.
Hello, traders! On July 1, the euro/dollar pair made another attempt to close under the upward trend line. Thus, despite two attempts by bears to break into the market, the general mood of traders remains "bullish". However, only formally. On the 4-hour chart, it is much more clearly visible that the pair is now moving inside the side corridor. Meanwhile, all the attention of traders is shifting again from the economic topic to the topic of health. In recent months, America has been ranked first in the world for the number of coronavirus diseases. The authorities, including Donald Trump, made a lot of contradictory statements, but a month and a half after the beginning of the epidemic, it became clear that the United States failed to prepare for the pandemic. That is why we have received a huge number of infections and deaths. However, at this time, when European countries are experiencing low rates of proliferation. In America, they are only accelerating. The government of the country is very reluctant to comment on what is happening, regularly reading the mantra about "a large number of tests conducted". Meanwhile, the country may find itself in a new "lockdown", although this now looks unlikely. At the same time, Donald Trump wants Americans to return to work as quickly as possible and not receive high unemployment payments.
EUR/USD – 4H.
On the 4-hour chart, the quotes of the euro/dollar pair performed a reversal in favor of the euro currency and began a new growth process in the direction of the corrective level of 76.4% (1.1294). The rebound of the pair's exchange rate from this Fibo level will again work in favor of the US dollar and some drop in quotes in the direction of the corrective level of 61.8% (1.1167). Today, the divergence is not observed in any indicator. The "bullish" mood of traders remains at this time. The US dollar is not in demand among traders.
EUR/USD – Daily.
On the daily chart, the euro/dollar pair again performed a reversal in favor of the US currency and closed under the corrective level of 127.2% (1.1261), which allows traders to expect a continued fall in the direction of the Fibo level of 100.0% (1.1147).
EUR/USD – Weekly.
On the weekly chart, the euro/dollar pair rebounded from the lower line of the "narrowing triangle", which still allows traders to expect growth in the direction of the 1.1600 level (the upper line of the "triangle"). However, the lower charts are now in a more bearish mood, so working out this goal is being postponed for now.
Overview of fundamentals:
On July 1, the European Union released quite good data on German unemployment, as well as on business activity in the manufacturing sector. American statistics were also quite optimistic, if you do not take into account the ADP report, which was weaker than traders' expectations. However, in general, traders did not give priority to either the dollar or the euro during the day. The evening publication of the Fed minutes did not correct the situation.
News calendar for the United States and the European Union:
EU - unemployment rate (09:00 GMT).
US - unemployment rate (12:00 GMT).
US - change in the number of people employed in the non-agricultural sector (12:30 GMT).
US - change in average hourly earnings (12:30 GMT).
US - number of initial applications for unemployment benefits (12:30 GMT).
On July 2, relatively important unemployment levels will be released in the EU and the US. More important statistics will be released after lunch – Nonfarm Payrolls, which can move the market from one place.
COT (Commitments of Traders) report:
The latest COT report, released last Friday, showed almost nothing. The "Non-commercial" group, which is the most important group and is considered to be the one that drives the market, has opened a total of only 5,000 contracts, of which 3,000 are long and 2,000 are short. The "Commercial" group (hedgers) were more active and opened almost 11,000 short-contracts, however, as we can see, in the period from June 17 to 23, the euro/dollar pair was trading first down, then up, then down again. In other words, it is impossible to conclude that the mood of traders during this period of time was the same and did not change. And the changes in the balance of forces that the latest COT report showed do not allow us to draw any conclusions for the long term.
Forecast for EUR/USD and recommendations to traders:
Today, I recommend buying the euro currency with the goal of 1.1496, if the close is made above the corrective level of 76.4% (1.1294). I recommend opening new sales of the pair with the target level of 61.8% (1.1167), if the rebound from the level of 1.1294 is made.
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency, not for speculative profit, but to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
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