EUR/USD – 1H.
The EUR/USD pair during Wednesday, June 9, tried to start new growth in the direction of the level of 1.2238. However, quotes performed a fall to the Fibo level of 161.8% 1(.2166) this morning. A rebound of the pair's rate from this level will allow us to count on a new growth process in the direction of 1.2238 and a close below it – on a further fall in the direction of the level of 1.2117. However, the level of 1.2166 did not always allow a signal to form near it. Moreover, today, there will be several significant events for the euro/dollar pair, which can greatly affect the mood of traders during the day. It is primarily about the ECB meeting. Most analysts agree that the parameters of monetary policy will remain unchanged. The ECB has repeatedly stated that rates will not start to rise until inflation reaches a stable 2% in the medium term.
At the end of May, inflation reached 2% y/y for the first time in recent years. Thus, it is not necessary to talk about any medium-term effect yet. Christine Lagarde also stated that the current jump in inflation is due to the low inflation values last year and the increase in energy prices. Representatives of the Federal Reserve and the Bank of England also believe that inflation is a temporary phenomenon. The consumer price index may begin to decline by the end of the year. The same goes for the PEPP economic assistance program. It is designed for action until the end of March 2022. Given that the EU economy is just beginning to recover from the crisis, there is no reason to expect an early curtailment of the stimulus program. Thus, the most interesting event may be the speech of Chairwoman Christine Lagarde.
EUR/USD – 4H.
On the 4-hour chart, the pair's quotes performed an increase to the level of 1.2223. However, there was no rebound from this level. Thus, the quotes performed a reversal in favor of the US currency and began a new fall in the direction of the corrective level of 161.8% (1.2027). However, the fall is very weak, and the whole movement has been very unstable in recent weeks.
EUR/USD – Daily.
On the daily chart, the quotes of the EUR/USD pair closed above the level of 161.8% (1.2027). But at the moment, all the charts signal different movements and directions. There is no unity in the graphic picture.
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 June 9, the calendars of economic events in America and the European Union were empty, so there was no information background.
News calendar for the United States and the European Union:
EU - publication of the ECB's decision on the main interest rate (11:45 UTC).
EU - monetary policy report (11:45 UTC).
EU - ECB press conference (12:30 UTC).
US - consumer price index (12:30 UTC).
On June 10, a very important inflation report will be released in the US, and around the same time, the results of the ECB meeting will be released in the European Union and a press conference with Christine Lagarde. Today, the information background can be very strong.
COT (Commitments of Traders) report:
Last Friday, another COT report was released, which again showed an increase in the "bullish" mood among speculators. The "Non-commercial" category of traders opened only 751 long contracts, but at the same time, got rid of almost 4 thousand short contracts. Thus, speculators continue to contribute to the growth of the European currency in one way or another. In general, the changes in all categories of traders are minimal. In total, 224 long contracts and 2,142 short contracts were closed, which indicates a low activity of major players in the reporting week.
EUR/USD forecast and recommendations for traders:
I recommend selling the pair in the case of a rebound of quotes from the level of 1.2223 on the 4-hour chart with targets of 1.2166 and 1.2117. I recommend buying the pair in case of an accurate rebound from the corrective level of 161.8% (1.2166) on the hourly chart with a target of 1.2238.
"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.