Yesterday, trading on the EUR/USD currency pair took place with the varying success of the opposing sides and resulted in exactly what often manifests itself on Mondays. Namely, a market shake-up and some uncertainty. Although, of course, nothing has changed dramatically. It seems that market participants continue to arrive under the influence of the "dovish" rhetoric of the last meeting of the US Federal Reserve System (FRS). However, it is worth noting that recently investors have begun to exaggerate the topic of a possible candidate for the post of Fed chairman. Naturally, we will not see a new face in this important post until the beginning of next year, when Jerome Powell's first term of leadership expires. However, it remains likely that US President Joe Biden will leave Powell for a second term. This monetary official is a very qualified specialist who did not bend even under the pressure of his fellow party member and protege, former US President Donald Trump.
However, there is more talk that Lael Brainard is the main candidate for the post of head of the Federal Reserve. Although many consider Brainard to be a more "dovish" monetary politician, she expressed the opinion that the US labor market is still quite a long way to recover, which means that the Fed's monetary policy tightening will not begin soon. However, Brainard had other statements, but what's the point of talking about it now? There is still plenty of time until February next year, and a lot can change in the world. Before considering price charts, let us briefly talk about today's macroeconomic events that may affect the dynamics of the main currency pair of the Forex market. At 10:00 London time, reports on changes in producer prices will be received from the eurozone. And at 15:00 (London time), the US will publish data on production orders, and at 19:00 (London time), there will be a speech by FOMC member Richard Clarida. That's probably all. It's not a very informative day.
Daily
During yesterday's trading, the pair again rose to the area of a strong and significant technical level of 1.1900, and again the euro bulls failed. Already near this important mark (at 1.1897), the pair encountered strong resistance from sellers and rolled back to 1.1869, where it completed trading on the first day of the current five-day period. A characteristic candle with a tiny bullish body and a much longer upper shadow once again confirmed the opinion already expressed yesterday that it will not be easy to go up to the level of 1.1900. But, as you know, nothing is impossible on the market, and the chances of passing the 19th figure remain. It may require a strong driver or an increase in bullish sentiment for the pair.
For the players on the increase, the situation is complicated because the orange 200-exponential moving average passes at 1.1913, which can strengthen the already powerful resistance in this price area. Thus, together with the level of 1.1900, the bulls in the single currency need to close the daily session even above the 200-EMA. In the area of 1.1950, the 89-exponential and 50-simple moving averages have merged, which will also be ready to resist the pair. So it turns out that the nearest and most important resistance zone is 1.1900-1.1950. The future direction of the euro/dollar will largely depend on the ability to overcome this area. The red Tenkan line and the blue Kijun line of the Ichimoku indicator, which are concentrated in the area of 1.1845-1.1835, are designed to provide support on the daily chart.
H1
The hourly chart clearly shows that the EUR/USD pair is trading in a flat at this stage of time. The quote seems to be glued to the 50-MA and can not break away from it in either direction. Given that 89 and 200 exponentials are located below (in the area of 1.1865-1.1845), it is reasonable to assume that these moves can support the price. In addition, the allocated price zone is technically quite strong in itself. Today, I recommend taking a closer look at the selected area and the price. If the pair falls into the designated area and bullish candlestick analysis patterns appear, those who wish can take advantage of this opportunity to buy EUR/USD. If we see the opposite picture and bearish candles in the area of 1.1900-1.1915, this can be perceived as a signal for sales. With both positioning options, I recommend not setting big goals but limiting yourself to 30-40 points of profit, after which you exit the market.
