From the point of view of complex analysis, you can see the next rebound from the border of the previously passed flat, and now let's talk about the details.
The past trading day was very similar to Monday, only the rate of price change was higher. So, the quote approached the level of 1.2620 once again, where a support point was found on a regular basis, which led to a reversal move towards the value of 1.2740, thereby completing the well-known sequence. Price consolidation above the flat formation of 1.2150 // 1.2350 // 1.2620 has acquired a scale of more than 70 hours, which means that the previous borders have lost their influence, and market participants are striving for new ranges that are already at the construction stage.
Regarding the development of new ranges, it is worth paying attention to the fact that the point of the report starts above 1.2770 on a four-hour chart, where the regularity of the past relative to the levels of 1.2770 / 1.3000 / 1.3300 is taken as the basis for new boundaries. If the coordinates of 1.2770 at the current stage of consolidation does not decline, then in this case, the subsequent fluctuation between the values of 1.2620 / 1.2770 should not be excluded from the analysis, where the work will go according to the method of breakdown of the established boundaries. As we see from the reasoning above, the tactics of trading operations are focused on broken positions, which is due to the high emotional background in the market.
In terms of volatility, the acceleration process is recorded, which is already long-term, which indicates a high speculative interest of market participants.
As discussed in the previous review, traders were focused on breaking the main boundaries of 1.2620/1.2770, but at the same time they worked on local operations using the rebound method, which brought a small profit.
Considering the trading chart in general terms, the daily period, we can distinguish about 80% recovery relative to the downward inertia from March 10, which is confirmed in some way by the theory of changes in the boundaries of fluctuations in the future.
The news background of the past day included data on the number of JOLTS open vacancies in the United States, where they recorded a decline from 6,011 thousand to 5,046 thousand with a forecast of 5,300 thousand. This figure is contrary to a recent report by the US Department of Labor, where they predicted an increase in the number of new jobs, but, based on JOLTS data, there is a discrepancy.
The market reacted to macroeconomic statistics in terms of a weakening US dollar.
In terms of the general informational background, we have various emotions related to the transition period after Brexit, and so, the general treasurer in the British government Penny Mordaunt said that the UK does not intend to extend the transition period and will be released in accordance with the existing agreements, that is, in December this year.
It is worth recalling that June is the last month where the United Kingdom may request a deferment on which the EU insists, but England goes all-in.
Today, the focus of the meeting is the Federal Committee on Open Market Operations, where, as always, passions and emotions are raging. What will the Fed do? Do not panic, the regulator has already made it clear that he does not plan to touch the interest rate unnecessarily. His current main goal is to monitor and adjust actions that were already taken.
In terms of the economic calendar, we have inflation data in the United States, where they forecast a decline from 0.3% to 0.2%. This indicator played the role of a kind of indicator for monetary policy actions, thereby it may be the most interesting in anticipation of the results of the Fed.
Further development
Analyzing the current trading chart, you can see the touch of the level of 1.2770, where the quote with surgical accuracy slows down the inertial movement that arose from the border of 1.2620. Now, you should be extremely careful in terms of analyzing price consolidating points relative to the level of 1.2770, since price consolidation above the control value in a four-hour period will indicate a predominant upward trend. Otherwise, we will expect further fluctuation within 1.2620 / 1.2770.
In terms of the emotional component of the market, here with the naked eye you can see speculative interest that pumps activity into the market.
It can be assumed that in case of testing the level of 1.2770, the quote will go towards the border of 1.2620 again, where the system of fluctuations will be closed. The main strategy is to break the specified boundaries of 1.2620 / 1.2770.
Based on the above information, we derive trading recommendations:
- We consider buying positions if the price is consolidated above 1.2770 in a four-hour period, where the prospect of the movement will be in the direction of 1.2885.
- We consider selling positions in the case of working out the level of 1.2770 in the downward direction, with the prospect of a movement to 1.2700 - 1.2620.
Indicator analysis
Analyzing a different sector of time frames (TF), we see that the indicators of technical tools regarding hourly and daily periods signal purchases, due to the inertial course, as well as the price concentration within the level of 1.2770.
Volatility per week / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, calculated for the Month / Quarter / Year.
(June 10 was built taking into account the time of publication of the article)
The volatility of the current time is 80 points, which is already a lot to start the European trading session. It can be assumed that the market will continue to accelerate amid the information and news flow.
Key levels
Resistance zones: 1.2770 **; 1.2885 *; 1.3000; 1.3170 **; 1.3300 **; 1.3600; 1.3850; 1.4000 ***; 1.4350 **.
Support Areas: 1.2620; 1.2500; 1.2350 **; 1.2250; 1.2150 **; 1.2000 *** (1.1957); 1.1850; 1.1660; 1.1450 (1.1411); 1.1300; 1.1000; 1.0800; 1.0500; 1.0000.
* Periodic level
** Range Level
*** Psychological level
**** The article is based on the principle of conducting a transaction, with daily adjustment
