4-hour timeframe

Amplitude of the last 5 days (high-low): 55p - 37p - 64p - 62p - 30p.

Average volatility over the past 5 days: 50p (average).

On the second trading day of the week, around lunchtime, the EUR / USD pair nevertheless reached the Kijun-sen critical line, and having confidently broken it, it rebounded and is now preparing to resume the upward trend. At least, the upward movement in the US trading session speaks about this. Looking at it, it may seem that the volatility today was quite high, the last two candles look so convincing, but in reality, neither the first nor the second does not exceed 40 points, which is not very much even for the euro currency. Yesterday, for example, it ended with a volatility of 30 points for the pair. Thus, in reality, the euro/dollar pair is practically standing still, showing low activity and not an overly strong upward trend.

We called macroeconomic reports of today as absolutely secondary and did not expect any reaction of traders to their publication. And so it happened. All three economic sentiment indices in Germany and the European Union unexpectedly turned out to be better than experts' forecasts, however, they remained negative and much worse than the values of the previous month. Thus, it turns out that the mood indices in the business environment turned out to be worse than a month earlier, experts just expected them to fall even more. You can, of course, associate the pair's fall by "as much as" 30 points in the European trading session with these reports from the ZEW Institute. However, we believe that they have nothing to do with it. There were no more macroeconomic publications during the day, Donald Trump, Jerome Powell or Mario Draghi did not give speeches.

Separately, one can single out the comments of the representative of the Ministry of Foreign Affairs of the People's Republic of China, Gen Shuang, who confirmed the words of Donald Trump that the talks between China and the United States were productive and an agreement was reached on many important issues. Shuang also confirmed that China has resumed and increased purchases of agricultural products from America. It is clear that if Beijing and Washington agree, then this will be good for everyone. The global economy and the economies of both China and the United States. Furthermore, the Federal Reserve may no longer need to think about another key rate cut. However, we would like to warn traders from premature conclusions, since there have already been plenty of escalations in the trade conflict, as well as mutual accusations. Thus, until the formal signing of the agreement between the countries, all comments like "we have made progress in the negotiations" can only be regarded as a pleasant message, nothing more. In addition, we would like to once again note that this topic is just interesting for traders, nothing more. The trade war and, accordingly, the de-escalation of the conflict will affect the macroeconomic indicators of the United States, but this will also affect the dollar exchange rate in pairs with other currencies, in particular the euro.

The technical picture of the currency pair shows a very probable resumption of the upward movement within the upward trend, which remains. With all this, the upward movement cannot be called strong, the euro has no fundamental support as such, and tomorrow the report on inflation in the European Union may cause new sales of the euro currency.

Trading recommendations:

The EUR/USD pair could complete the correction near the critical line. Thus, traders are now advised to resume buying the euro with the goal of a first resistance level of 1.1086. It will be possible to return to US currency purchases in case of overcoming the Kijun-sen line with the targets of 1.0992 and 1.0964.

In addition to the technical picture, fundamental data and the time of their release should also be taken into account.

Explanation of the illustration:

Ichimoku indicator:

Tenkan-sen is the red line.

Kijun-sen is the blue line.

Senkou Span A - light brown dotted line.

Senkou Span B - light purple dashed line.

Chikou Span - green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

Red line and bar graph with white bars in the indicator window.