From the point of view of a comprehensive analysis, we see a price return to the area of the psychological level of 1.3000, where the quote slowed down, and now let's talk about the details. The upward spiral set on Friday was able to return the quote to the area of the upper boundary of the range 1.2770 // 1.2885 // 1.3000 without unnecessary efforts, where the quote gradually turned into a slowdown. This development was expected, and we considered this outcome in the previous review. In fact, the initial overheating of short positions in the region of 1.2855 led to a fixation, where after the traders tested the levels for the reverse bay, and the most impressive coordinates were the level of 1.3000, where the quote came.
Regarding the theory of downward development, we see that the quote is still moving inside the given boundaries, which signals the confirmation of a change in the clock component. Now, the goal is to work out the level of 1.3000, where traders will be able to enter a downward tact using more attractive values. The current development reflects the fluctuation in the upper part of the range, which is not yet talking about restoring the source code, but the fact of fixing is confirmed. The start of the recovery process will come only after the breakdown of the level of 1.2770, not earlier.
In terms of volatility, we see that the acceleration is still preserved in the market, where the activity of fluctuations exceeds the average daily indicator by 9%. Let me remind you that acceleration arose at the time of the reverse stroke set on Friday.
Details of volatility: Friday - 104 points; Monday - 67 points; Tuesday - 103 points. The average daily indicator, relative to the dynamics of volatility is 94 points [see table of volatility at the end of the article].
By detailing the minute by minute, we see that the first round of the upward movement was set at the start of the European session, where a slight correction subsequently occurred and already at the start of the American session, the upward cycle resumed, driving the quote to the psychological level of 1.3000.
As discussed in the previous review, strategic positions are still holding downward development with a medium-term outlook. In turn, intraday traders tested levels for resistance while in correction mode.
The recommendation from Tuesday, regarding the local upward trend, coincided, having a small profit.
[Local purchase positions were considered in case of price fixing higher than 1.2980, towards 1.3000-1.3015.]
Considering the trading chart in general terms [the daily period], we see movement within the upper boundary of the range 1.2770 // 1.2885 // 1.3000, where the clock frequency is considered to be working, which may contribute to the resumption of the downward movement.
The news background of the past day contained S & P / CS data on housing prices in the United States, where they recorded an acceleration from 2.5% to 2.9%, with a forecast of 2.7%. The reaction of the market, in particular the dollar, was even before the publication, since there was a weakening of the American currency at the time of the release of statistical data, just with touching the area of psychological level.
In terms of the general information background, we have the approval of the mandate from the European side, and now, Europeans are ready to begin negotiations with Britain in early March. In turn, British Prime Minister Boris Johnson met with Austrian Chancellor Sebastian Kurz, where they discussed the upcoming negotiations, as well as the life and work of the Austrians living in the United Kingdom and the British in Austria.
"After the publication of the EU negotiating mandate, the leaders discussed a common desire to reach a free trade agreement between the UK and the EU. The Prime Minister made it clear that the UK will not accept any requirements to follow European law, nor can we expect the EU to follow British laws. He stressed that the UK is committed to maintaining our very high standards," the statement said.
Today, in terms of the economic calendar, we have data on new home sales in the United States, where they forecast an increase from 694K to 710K.
Further development
Analyzing the current trading chart, we see an attempt to work out the psychological level of 1.3000, where the quote initially slowed down the fluctuation, forming a stagnation of 1,2990 / 1,3015, and then locally broke through the lower border. In fact, accumulation within the control level has not gone away, and thus, we are still concentrating on the level, trying to find the proper platform for the superiority of trade forces. Regarding the prospects for decline, the development theory is still valid. The price is within the established framework, and in this case, time is needed for the main course to become. Theory will be questioned if prices are fixed higher than 1.3100.
From the point of view of the emotional mood, we see a large number of impulse candles in the interval of 1.5 weeks, which confirms the high speculative interest.
By detailing the per-minute time span, we see weak activity within the 1.3000 level, where even the start of the European session did not give the desired result.
In turn, many traders are waiting for the denouement of the existing clutter, since there is a prospect of a decrease, but working out the level is not yet on an adequate scale. Medium-term traders are invariably in short positions; plans will be revised if prices are fixed higher than 1.3100.
Having a general picture of actions, it is possible to assume amplitude fluctuation along the psychological level with a range of 1.2975 / 1.3030. The tactics of the work was selected by the method of breakdown of the given frames while maintaining the inertial mood.
Based on the above information, we derive trading recommendations:
- Local purchase positions are considered in case of price fixing higher than 1.3030, towards 1.3066.
- Sales positions are considered in case of working out the level of 1.3000 and fixing the price lower than 1.975.
Indicator analysis
Analyzing a different sector of timeframes (TF), we see that the indicators of technical instruments changed the signal to an upward one due to the corrective move, which is more like a neutral signal in terms of daily periods.
Volatility per week / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, calculated for the Month / Quarter / Year.
(February 26 was built taking into account the time of publication of the article)
The volatility of the current time is 32 points, which is a low value for a given period of time. It is likely to suggest that acceleration may occur if you exit the area of the psychological level. Otherwise, low activity will last all day.
Key levels
Resistance Zones: 1.3000; 1.3170 **; 1.3300 **; 1.3600; 1.3850; 1.4000 ***; 1.4350 **.
Support Areas: 1.2885 *; 1.2770 **; 1.2700 *; 1.2620; 1.2580 *; 1.2500 **; 1.2350 **; 1.2205 (+/- 10p.) *; 1.2150 **; 1,2000 ***; 1.1700; 1.1475 **.
* Periodic level
** Range Level
*** Psychological level
**** The article is built on the principle of conducting a transaction, with daily adjustment
