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18.06.202113:45 Forex Analysis & Reviews: EUR/USD: plan for the US session on June 18 (analysis of morning trades).

To open long positions on EURUSD, you need to:

In my morning forecast, I paid attention to the level of 1.1923 and recommended that you decide to enter the market from it. Let's look at the 5-minute chart and talk about what happened. The bears made an unsuccessful attempt to push the pair to new weekly lows, after which the demand for the euro returned. The formation of a false breakout in the resistance area of 1.1923 led to an entry point into short positions. However, after a small movement of 15 points, the activity of sellers ended. It suggests that many are afraid of taking profits above the level of 1.1923 and are not very active at the end of the week at the current lows. From a technical point of view, nothing has changed in the afternoon.

Exchange Rates 18.06.2021 analysis

The divergence, which I discussed in detail in the morning forecast, is playing itself out, and sellers are in no hurry to return to the market. The main task of the bulls for the second half of the day remains to protect the support of 1.1880. However, there is also hope for a breakthrough of the resistance of 1.1923. Going beyond it and testing this level from top to bottom can form a signal to open long positions to restore the pair to a larger resistance of 1.1961, where I recommend taking the profit. The next target will be the area of 1.2003. If we do not see buyers' activity in the area of 1.1923 again, and the bears take the market into circulation, it is best to wait for the update of the minimum of 1.1880 and the formation of a false breakdown on it, which forms a signal to open long positions. If there are no noticeable buyers, and we easily breakthrough 1.1880, in this case, it is best to open new long positions from the next support of 1.1839 in the expectation of an upward correction of 15-20 points within the day.

To open short positions on EURUSD, you need to:

As long as the trade is conducted below the resistance of 1.1923, the pressure on the euro will continue. The next formation of a false breakout in the second half of the day against the background of the absence of important fundamental statistics on the US economy forms a signal to open short positions to continue the downward trend formed in the middle of this week. But the more important task for sellers is to break the minimum of 1.1880. A breakout and a test of this area from the bottom up on the volume will form an excellent signal to open short positions with the aim of further falling EUR/USD to new lows of 1.1839 and 1.1805, where I recommend taking the profits. If the bulls in the second half of the day still achieve a breakdown of the resistance of 1.1923, I recommend postponing short positions until the test of a new high of 1.1961, where you can immediately sell the pair for a rebound in the expectation of a downward correction of 15-20 points. Above this level, the moving averages also pass, playing on the side of sellers.

Exchange Rates 18.06.2021 analysis

Let me remind you that the COT report (Commitment of Traders) for June 8 noted a reduction in both long and short positions. It pointed to profit-taking and the exit of traders from the market before the important meeting of the European Central Bank, which resulted in no changes in monetary policy. Many were concerned about what would happen to the bond-buying program, but it remained unchanged, which did not allow euro buyers to keep the market under their control. The pair is now at risk of significantly adjusting their positions ahead of an important meeting of the Federal Reserve System, the results of which will set the direction of the market for the next few weeks. The dollar can only hope that this summer, the Federal Reserve will seriously talk about reducing the volume of bond purchases. If this does not happen, risk appetite will increase, and we will see a recovery in the euro. The COT report shows that long non-profit positions declined from 237,360 to the level of 232,103, while short non-profit positions also fell from the level of 128,038 to 124,890. The more the European currency falls, the more interest it will arouse among traders. The eurozone economy will demonstrate excellent growth rates in the summer, which will necessarily affect the prospects for its recovery after the coronavirus pandemic. The total non-profit net position decreased from 109,322 to 107,213. The weekly closing price also fell from 1.22326 to 1.21907.

Signals of indicators:

Moving averages

Trading is below the 30 and 50 daily moving averages, which indicates a continuation of yesterday's bear market.

Note: The period and prices of the moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

A break of the upper limit of the indicator in the area of 1.1923 will lead to a new wave of euro growth. A break of the lower limit in the area of 1.1900 will increase the pressure on the pair.

Description of indicators

  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
  • MACD indicator (Moving Average Convergence / Divergence - moving average convergence/divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-profit speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet specific requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Short non-commercial positions represent the total short open position of non-commercial traders.
  • Total non-commercial net position is the difference between the short and long positions of non-commercial traders.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Miroslaw Bawulski,
Experto analítico de InstaForex
© 2007-2021
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