From the point of view of technical analysis, we see a breakdown of the control value and confirmation of the previously voiced theory, and now in order. It was previously noted that the price built an amplitude along the first recovery level of 1.1080, where such values as 1.1055 and 1.1100 fell under special control, regarding which it was decided to act. As you can see from the result, the value of 1.1055 fell and short positions returned to the market, which means that the previously voiced theory coincided. So, in theory, it was said that as part of the move 1,1000 -> 1,1080 there are no prerequisites for the failure of the recovery process, but there is only a correction due to local overheating of short positions caused by the move 1,1180 -> 1, 1000. In this reasoning, I would not put an end to it, since in order for the theory to coincide 100%, the quote needs to break through the second stage [1, 1000] recovery process and go to the finish segment # 3/1 -> # 3/2. Thus, while the psychological level of 1.1000 has not fallen, there is still a risk of a rebound from it, which should be prepared for.
In terms of volatility, there was light at the end of the tunnel, it was reflected in the Friday's wobble, which gradually to 75 points, this is an excess of the average daily value, which had not existed for so long. Monday, in turn, reflected a sharp decline in volatility [28 points], which is probably due to the convergence of prices with the psychological level of 1.1000. The emotional component of market participants became better after the recovery process resumed and the quotation went beyond 1.1055 / 1.1100.
When analyzing the past day hourly, we see an extremely sluggish fluctuation, but it is worth paying tribute that even with such a fluctuation, we managed to maintain a downward interest, having a control rapprochement with the psychological level.
As discussed in the previous review, for several days in a row, traders carefully monitor the coordinates with values of 1.1055 (Sell) / 1.1100 (Buy) for clear breakdowns. Sitting outside the market yielded results in terms of falling into the main impulse, which as a result brought considerable income in a downward move.
Considering the trading chart in general terms [the daily period], we see that the quotation has again returned to the desired phase, having approximately 59% of working out relative to the elongated correction. In total, we have almost two months of finding the price within the correction that occurred at the time of the rebound from the value of 1.0879.
The news background of the last day was extremely modest, the only thing that can be highlighted is the German IFO data for November:
• IFO Current Situation Indicator: Prev 97.8 ---> Forecast 97.9
• IFO Economic Expectations Index: Prev 91.6 ---> Forecast 92.1
• IFO Business Optimism Index: Prev 94.7 ---> Forecast 95.0
As we can see, Germany's IFO indicator is growing, which is a good sign, but, unfortunately, this indicator does not play into the mood of the EURUSD pair, and thus there was no market reaction.
In terms of informational background, it was a bit more interesting, and so, again, everyone started talking about US-Chinese relations, in particular, the first part of the trade deal. In fact, the main development of this discussion has already begun today, when the whole of Europe was still asleep, and the United States was just getting ready for bed, there was a phone call between Chinese Deputy Prime Minister Liu He and US Secretary of the Treasury Stephen Mnuchin. During the telephone conversations, there was once again a conversation on trade and economic issues, and we agreed to maintain contacts in the first part of the trade agreement.
"On Tuesday morning, Vice Premier of the State Council of the PRC Liu He had a telephone conversation with US Treasury Secretary Stephen Mnuchin and US Trade Representative Robert Lightheiser. The parties discussed ways to address the main concerns of each of the parties, agreed to maintain contact on the remaining issues regarding consultations on the first part of the agreement, "the statement says.
In addition, the Minister of Trade of China Zhong Shan, the head of the People's Bank of China Yi Gang and the deputy head of the State Committee for Development and Reform Affairs Ning Jizhe participated in the conversation.
If the first phase of the transaction is not completed before December 15, Donald Trump will have to decide whether to fulfill his previous threat, introduce 15% tariffs on some goods from China.
Even if the first part of the agreement is signed, it may still face difficult issues, such as US concerns about Chinese subsidies and attempts to shut down Chinese technology companies in the US market due to security risks. At the same time, riots in Hong Kong, which are becoming additional points of tension, are a significant drop in excitement.
Perhaps today there will still be telephone conversations between the two countries, where they will discuss the removal of tariffs, agricultural purchases, and mechanisms for implementing the transaction.
Today, in terms of the economic calendar, we had data for the United States, where the sales of new homes should increase by 1.2%, which in quantitative terms is 0.701M ---> 0.709M. At the same time, the S & P / CS Composite-20 composite housing price index, seasonally adjusted, will also show growth from 2.0% to 2.1%.
Further development
Analyzing the current trading chart, we see a characteristic slowdown within the psychological level of 1.1000, where the quote is rather sluggishly active, which is typical for this range. In fact, now there is a fear of a rebound from the level, as it was in the past, but at the same time, the desire to pass the control level is high for the reason that the existing rapprochement is not the first.
Detailing the available time interval per minute, we see an extremely narrow amplitude of 7-8 points, where even with the entry of Europeans into the market, nothing has changed.
In turn, traders completely left short positions that they had previously opened, having a profit on the deposit. Now we are carefully analyzing the behavior of quotes for breakdown and rebound relative to the control level.
It is likely to suggest that a stop can flow into accumulation, with frames of 1.0990 / 1.1030, where the strategy will be according to the method of breaking down boundaries. It is worth considering that in the event of a fracture of step number 2, the long-awaited descent to steps 3/1 and 3/2 awaits us, which many are waiting for and hoping for in terms of finishing restoration with respect to an elongated correction. [see chart below]
Based on the above information, we derive trading recommendations:
- Buy positions are considered in case of price-fixing higher than 1.1035, with a prospect of 1.1055-1.1060.
- We consider selling positions in the case of a clear fixation of the price lower than 1.0985, not a puncture shadow.
Indicator analysis
Analyzing a different sector of timeframes (TF), we see that indicators of indicators relative to the main periods maintain a downward mood, and only at minute intervals do we see variable interest due to stagnation.
Volatility per week / Measurement of volatility: Month; Quarter Year
Measurement of volatility reflects the average daily fluctuation, calculated for the Month / Quarter / Year.
(November 26 was built taking into account the time of publication of the article)
The volatility of the current time is points, which, obviously, is an extremely low indicator. It is likely to assume that in the event of a breakdown or a rebound relative to the control level, acceleration may occur, in all other scenes we are waiting for a sluggish oscillation with low volatility.
Key levels
Resistance zones: 1.1080 **; 1,1180 *; 1.1300 **; 1.1450; 1.1550; 1.1650 *; 1.1720 **; 1.1850 **; 1,2100
Support Areas: 1,1000 ***; 1.0900 / 1.0950 **; 1.0850 **; 1,0500 ***; 1.0350 **; 1,0000 ***.
* Periodic level
** Range Level
*** Psychological level
***** The article is built on the principle of conducting a transaction, with daily adjustment
