4-hour timeframe
Amplitude of the last 5 days (high-low): 51p - 76p - 28p - 56p - 38p.
Average volatility over the past 5 days: 50p (average).
The first trading day of the new week for the European currency paired with the US dollar went exactly according to the scenario. According to the correction scenario. In the morning we said that for today no significant macroeconomic publication is planned either in the European Union or in the United States. Thus, the fundamental background was simply absent today, and traders had nothing to react to during the day. Thus, market participants decided to use an empty news calendar to consolidate part of the profit on short positions, which they did not do on Friday, when there were also favorable conditions for this. For the same reasons, volatility today is extremely low, no more than 27 points at the moment. In this situation, traders can only wait for the arrival of important macroeconomic information on the market, which will not be earlier than Wednesday. Therefore, tomorrow corrective movement and weak volatility may persist.
Meanwhile, in the US, all the attention of the population is riveted to the topic of presidential elections, which will be held in 12 months. They will pass in 12 months, but passions are already in full swing, as the impeachment procedure of Donald Trump continues, skirmishes between the current president and his possible rivals also take place, and recently it became known that another Democrat could run for president of the United States - Michael Bloomberg. Why is Michael Bloomberg's figure so interesting? Well, firstly, the electoral system in the United States is very complex, and each party should have only one main candidate for president. That is, either it will be Michael Bloomberg, or Joe Biden. There are 16 more candidates from the Democratic Party, but which of them will fight for the presidency at the final stage will be decided at the party congress in 2020. Secondly, Michael Bloomberg is one of the richest people in the United States. His condition exceeds the condition of Donald Trump by 17 times. He also owns an information agency in America, one of the most famous in the world, that is, he is always in contact with the people and, accordingly, the voters. In addition to the contact with voters, the agency employs a huge number of sociologists and analysts who can easily calculate the mood of the electorate and the ratings of one or another presidential candidate. Why did Bloomberg decide to run for election? According to one version, he is an opponent of radical leftist views. For example, some presidential candidates offer additional taxes to billionaires. Naturally, this does not suit billionaires themselves, so Bloomberg is interested in the fact that left-wing politicians do not get to power. When all left-wing politicians are eliminated, Bloomberg himself may lose his track by calling on his supporters to vote for the same Joe Biden.
Why does Michael Bloomberg himself have a good chance of winning? If only because Joe Biden and Donald Trump "drown" each other. Trump tried to find incriminating evidence on his main competitor, as he believed, in Ukraine, and failed. Joe Biden took advantage of the situation and launched a campaign against Donald Trump (impeachment), but Trump himself is not only going to defend himself and regularly tries to cast a shadow on Biden's personality. As a result, both presidential candidates worsen their political ratings. If in the United States the figure of the president was chosen by a simple majority of voters, then it would be possible to say that Trump and Biden would definitely win. However, as we have already said, the electoral system in America is complicated, and in fact, the states will vote. That is, no matter how many voters will support one candidate or another, it is important how many states support him. Thus, Donald Trump and Joe Biden are likely to continue to pour mud on each other, which so far is exclusively entertaining for everyone (traders, voters).
From a technical point of view, the EUR/USD pair is now continuing to adjust, so traders now need to take a break for a while and wait for the correction to complete. The potential correction target is the Kijun-sen line of the Ichimoku indicator. At the same time, both the Ichimoku indicator and the Bollinger Bands continue to indicate a downward trend.
Trading recommendations:
The EUR/USD pair began to adjust. Thus, it is now recommended to wait until the correction is completed and sell the currency pair again with the target of 1.0986. A downward movement of the MACD indicator may show the end of the correction, as well as a price rebound from the critical line. It is recommended to return to purchases of the euro currency no earlier than the bulls breaking the critical Kijun-sen line, which is not expected in the near future.
Explanation of the illustration:
Ichimoku indicator:
Tenkan-sen is the red line.
Kijun-sen is the blue line.
Senkou Span A - light brown dotted line.
Senkou Span B - light purple dashed line.
Chinkou Span - green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD indicator:
Red line and bar graph with white bars in the indicator window.
Support / Resistance Classic Levels:
Red and gray dotted lines with price symbols.
Pivot Level:
Yellow solid line.
Volatility Support / Resistance Levels:
Gray dotted lines without price designations.
Possible price movement options:
Red and green arrows.
