EUR/USD – 1H.
The EUR/USD pair was actively growing again during the last trading day. The growth of quotes began in the morning. Moreover, bear traders continued to be disappointed during the day, which led to a new fall in the US currency. After rebounding from the Fibo level of 127.2% (1.2068), the quotes performed a consolidation above the level of 1.2117, which increases the chances of further growth to the corrective level of 161.8% (1.2166). Closing the pair's rate above this level will increase the "bullish" mood even more. The information background now clearly does not contribute to the strengthening of the US currency. We can not say that everything is bad in the United States right now. Rather the opposite. The economy is recovering as Jerome Powell said it would: quickly but unevenly. Some segments of the economy are still lagging behind others, which are showing the greatest growth.
Thus, perhaps the fall of the dollar, which is best seen on the 4-hour chart, is not entirely logical. However, bear traders do not find any reason to buy the US currency right now. We have clear technical trends and signals, and it would be foolish to ignore them. On Friday, the report on retail sales in the United States showed zero growth in April after the figure rose by 10.7% in March. It means that March was the peak month, and in April, US consumers slowed down. Thus, the dollar did not receive support from either statistics or traders. Retail sales, excluding auto sales, were down 0.8% from March. Industrial production rose 0.7% in April. However, traders were expecting at least a 1% increase. The consumer confidence index fell from 88.3 to 82.8. Traders, as well as investors, are still afraid of high inflation. And high inflation puts pressure on the US currency. Everyone is waiting for information from the Fed after the latest inflation data.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes performed a new rebound from the ascending trend line. However, it failed to show strong growth again. The bearish divergence of the CCI indicator warns of a possible new drop in quotes, but as long as the pair is trading above the trend line, the "bullish" mood of the market remains. Fixing the quotes under the trend line will favor the US currency, and some fall in the direction of the level of 1.1836.
EUR/USD – Daily.
On the daily chart, the EUR/USD pair quotes closed above the level of 161.8% (1.2027). Upward trends are continuing on all charts right now. On the daily chart, the target is the corrective level of 200.0% (1.2356).
EUR/USD – Weekly.
On the weekly chart, the EUR/USD pair performed a consolidation above the "narrowing triangle," which preserves the prospects for further growth of the pair in the long term.
Overview of fundamentals:
On May 14, the calendar of economic events in the European Union was empty, and in the US, the news put pressure on the US dollar.
News calendar for the United States and the European Union:
On May 17, the calendars of economic events in the European Union and the United States are empty, so today, the information background will be absent.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which again showed that speculators actively increased long contracts in the reporting week. A week earlier, the category of "Non-commercial" traders increased both types of contracts. Now the number of longs was 16,908, and the number of short - 5,319. Thus, the mood of the major players again becomes more "bullish," which indicates a possible continuation of the growth of the European currency. It is noteworthy that the total number of positions ("Total") is higher for short contracts. However, I remind you that we are more interested in the "Non-commercial" column.
EUR/USD forecast and recommendations for traders:
I recommend selling the pair when it rebounds from the level of 1.2166 on the hourly chart or closing below the trend line on the 4-hour chart with targets of 1.2068 and 1.1990. The pair was recommended to buy if the rebound on the hourly chart is made from the level of 1.2068 or the trend line on the 4-hour chart, with the goals of 1.2117 and 1.2166. The first goal is achieved. Now we are waiting for the second one to be worked out.
"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.