EUR/USD – 1H.
The EUR/USD pair reversed in favor of the US currency during the last trading day and began to fall under the corrective level of 127.2% (1.1873). However, it lasted for a very short time and in the next couple of hours, the quotes can perform a reverse close above the level of 127.2%, which will allow traders to count on the resumption of the growth process in the direction of the Fibo level of 100.0% (1.1952). During yesterday, there was almost no news that would interest traders. In the morning, the European Union released the index of business activity in the service sector for March, which was better than traders' expectations and almost got out of the "red zone" - 49.6. This slightly supported the European currency. In the late afternoon, the pair reversed in favor of the US dollar and began to prepare for the upcoming publication of the Fed minutes. The document said that, on the one hand, the Fed's leaders are happy with the progress in the economic recovery, on the other hand, the level of employment, the labor market, and inflation is still at levels much lower than expected. The report also said that the reduction in monetary stimulus will not begin until the Fed board sees significant progress in achieving full employment and inflation above 2%. Thus, the contents of the document "minutes of the Fed" hardly gave fundamentally new information to traders. It was known before him that the Fed is not going to wind down its stimulus program in the near future, and there is no question of raising rates at all now. It was also known that the US economy is recovering very quickly, however, it will take at least another year to fully return to the pre-crisis level of economic growth.
EUR/USD – 4H.
On the 4-hour chart, after rebounding from the Fibo level of 127.2% (1.1729), the pair's quotes continue to grow in the direction of the corrective level of 161.8% (1.2027). Fixing the pair's rate above the level of 1.1836 increases the chances of further growth. There are no emerging divergences in any indicator today.
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair consolidated above the corrective level of 261.8% (1.1822). Thus, the further fall of the pair is canceled for now, and instead, the growth can be continued in the direction of the Fibo level of 323.6% (1.2080).
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair has made a consolidation above the "narrowing triangle", which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On April 7, the calendar of economic events in the European Union was almost empty, and in the US, the Fed minutes were released, which did not have a significant impact on the pair's movement.
News calendar for the United States and the European Union:
EU - ECB report from the monetary policy meeting (11:30 UTC).
US - number of initial and repeated applications for unemployment benefits (12:30 UTC).
US - Federal Reserve Board of Governors Chairman Jerome Powell will deliver a speech (16:00 GMT).
On April 8, you should pay attention to the speech of Jerome Powell, the other events of the day are secondary.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which turned out to be "talking" this time. During the reporting week, traders of the "Non-commercial" category (the most important) opened 34 long contracts and 25,045 short contracts. Thus, even analyzing the behavior of speculators now makes no sense. Everything is clear enough. The mood of large traders continues to become more "bearish", as evidenced by the regular increase in the number of short contracts and a decrease in the number of long contracts. Thus, in the perspective of the daily chart, the fall in the quotes of the euro/dollar pair may continue. But the new downward trend may turn out to be quite long, so do not expect a drop in the next few weeks by another 300-500 points. Everything will happen gradually.
EUR/USD forecast and recommendations for traders:
I do not recommend selling the pair now, as it seems that a new upward trend has begun. Purchases of the pair were recommended with the goals of 1.1820 and 1.1873, and both goals have been achieved so far. I recommend new purchases of the pair when fixing above the level of 1.1873 with a target of 1.1952.
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency, not for speculative profit, but to support current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.