EUR/USD: in financial markets flat
In connection with the Easter holidays today in financial markets flat. Trades on European and American trading floors are not held. Trading volumes are low.
After a sharp decline yesterday, the dollar was able to recover in the pair EUR / USD. After Wednesday afternoon at the end of the trading day, Donald Trump said in an interview with The Wall Street Journal that the dollar is becoming "too strong," and American goods are "very, very difficult to compete" in a situation where "other countries reduce the value of their currencies" , the dollar fell sharply in the foreign exchange market.
Investors in the current situation prefer to withdraw their funds into safe assets, such as government bonds, yen, and gold. So, against the background of increased purchases, the yield of US 10-year government bonds fell to 2.237% on Thursday, the lowest level since November 16.
The alarming geopolitical situation in the world is also not conducive to the purchase of risky assets. The euro is also under pressure on the background of the pre-election race in France. If the victory is won by political leaders opposing the euro integration, then, still not recovering from Brexit, the euro can get another strong blow to its positions in the foreign exchange market. Thus, the EUR / USD pair has its own scenario at the moment.
In general, recently, against the background of an abundance of various macroeconomic and geopolitical factors, there is a multidirectional dynamics of the dollar and uncertainty of investors. This, again, increases the demand for safe haven assets. Gold has been growing in price since the middle of last month and is already the fifth consecutive session, updating annual price highs.
Flat in the financial markets can last until Tuesday. Nevertheless, you need to be prepared for unexpected price emissions, and, in any direction against the backdrop of low trading volumes.
Especially, it can happen during the news publication period. We are waiting for the data from the USA today. At 15:30 (GMT + 3) will be published inflationary consumer price indices and retail sales in the US for March. Strong data will help strengthen the dollar, and sharply. Weak data can contribute to an equally active decline in the dollar. By the end of the trading day, the dollar and the EUR / USD pair are likely to return to the levels of today's opening.
Support and resistance levels
On the daily chart of the pair EUR / USD, a tapering triangle formed. The upper line of the triangle is currently near the level of 1.0795 and roughly corresponds to the 200-period moving average on the daily chart. The lower line of the tapering triangle corresponds to the lower border of the ascending channel on the daily chart, passing near the level of 1.0580. The tapering triangle is a trend continuation figure. And since the downtrend prevails, it is more likely to break the lower boundary of the triangle (level 1.0580), followed by a decrease in the EUR / USD pair.
However, until this moment, the pair EUR / USD can still be repeatedly adjusted and "go down" to the upper limit of the triangle and the level of 1.0795. And instead of the expected breakdown of the level of 1.0580, rebound and growth may follow. So far, the negative dynamics of the EUR / USD pair is prevailing, while it is below the short-term resistance levels 1.0638, 1.0668 (EMA200 on 1-hour and 4-hour charts).
In the case of consolidating a pair above the level of 1.0668, it is highly probable that it will continue to increase to resistance levels 1.0735 (EMA144), 1.0795 (EMA200 on the daily chart).
The probability of such a scenario is signaled by the indicators OsMA and Stochastics, which turned on long positions on the 4-hour and daily charts.
If the negative background is maintained against the dollar, then the probability of the EUR / USD pair strengthening scenario will increase.
And, conversely, as geopolitical tension decreases, investors' attention will again switch to positive macroeconomic indicators from the US. In this case, the dollar's growth will resume, and the pair EUR / USD will again be under pressure and will finally break through the support level of 1.0580.
In case of further reduction, the targets will be the levels of 1.0530, 1.0500, and 1.0350. Long positions can be considered when returning a pair above the level of 1.0668.
Support levels: 1.0580, 1.0530, 1.0500, 1.0485
Resistance levels: 1.0638, 1.0668, 1.0690, 1.0735, 1.0795
Sell Stop 1.0595. Stop-Loss. Objectives 1.0580, 1.0530, 1.0500, 1.0485
Buy Stop 1.0645. Stop-Loss 1.0595. Objectives 1.0668, 1.0690, 1.0735, 1.0795