EUR/USD 5M
The volatility for the EUR/USD pair was low again and did not exceed 40 points on Tuesday. Thus, once again we can complain about this indicator, since it is extremely difficult to trade the pair with such volatility. As we said earlier, with low volatility, either trading signals are generated extremely rarely, or they are formed in batches, but are false. It's good that it was the first option yesterday. We also note that there were no important macroeconomic reports yesterday. Thus, traders had nothing to react to during the day. And given the fact that the results of the Federal Reserve meeting will be announced today, many traders do not want to risk and open trades before this event. As a result, the pair continues to be close to the lower border of the horizontal channel at 1.1700-1.2300, but is still unable to settle below it. Now let's move on to considering trading signals. Yesterday there was only one signal generated - to sell - when the price bounced off the extremum level of 1.1750. In fact, the price only reached the level of 1.1749, but an error of one point can be ignored. Thus, traders were able to enter short positions that could bring a small profit.
Overview of the EUR/USD pair. September 22. Day X has arrived for the US dollar.
Overview of the GBP/USD pair. September 22. Nancy Pelosi: There will be no trade agreement between the UK and the US.
EUR/USD 1H
You see on the hourly timeframe that the euro/dollar pair continues to correct after a rebound from the level of 1.1704, which is not just an extreme level, but also a target level for the second round of the global downward correction, as well as the lower border of the horizontal channel, in which quotes have been around for more than six months. Thus, this level is very important. At the same time, the downward trend persists, as the downward trend line is again relevant. It is not recommended to open long positions on the hourly TF until the price settles above it. On Wednesday, we continue to draw traders' attention to important levels and lines - 1.1666, 1.1704, 1.1750, 1.1805, as well as the Senkou Span B (1.1839) and Kijun-sen (1.1765) lines. The Ichimoku indicator lines can change their position during the day, which should be taken into account when looking for trading signals. Signals can be rebounds or breakthroughs of these levels and lines. Do not forget about placing a Stop Loss order at breakeven if the price moves 15 points in the right direction. This will protect you against possible losses if the signal turns out to be false. No important event or reports in the European Union on September 22. But in the United States, the results of the Fed meeting will be summed up in the evening and Fed Chairman Jerome Powell will also hold a press conference. There will be no interesting events in America during the day either. Thus, you will have to wait until late at night. In principle, traders can easily not trade at this late time, but only wait for the results of the meeting. Volatility is likely to rise strongly, so it will be very difficult to trade anyway.
We also recommend that you familiarize yourself with the forecast and trading signals for the GBP/USD pair.
COT report
The EUR/USD pair fell by 60 points during the last reporting week (September 7-13). The latest Commitment of Traders (COT) report showed minimal changes in the mood of the "non-commercial" group of traders, which, we recall, is the most important group of traders. During the reporting week, professional traders closed 4,000 contracts for buying (longs) and also the same number for selling (shorts). Thus, the net position has not changed, as well as the mood of the major players. But serious changes followed in the "commercial" group, where traders immediately closed 27,000 buy contracts (longs) and 36,000 sell contracts (shorts). These data are less important, but still the difference is striking. Returning to commercial traders, the total number of buy contracts (longs) they now have is 187.5 thousand, and sell contracts at 160 thousand. Thus, the bullish mood still persists, but it has significantly weakened in recent months. Therefore, we can say that the euro/dollar pair is currently teetering on the edge of an abyss called a "new downward trend". In principle, we have already said that the critical point for maintaining the long-term upward trend, which began in March 2020, is the level of 1.1700. If the bears manage to overcome it after a 9-month ordeal, then the chances of further strengthening of the US currency will increase sharply. Therefore, this issue may be resolved in the coming days. On the other hand, much will depend on the actions of the Fed not only at the next meeting, but also in the near future. If the markets do not find evidence of readiness to curtail QE, then the US dollar will lose its trump card in the confrontation with the euro currency.
Explanations for the chart:
Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.
Support and resistance areas are areas from which the price has repeatedly rebounded off.
Yellow lines are trend lines, trend channels and any other technical patterns.
Indicator 1 on the COT charts is the size of the net position of each category of traders.
