09.01.2021 14:22 Forex analysis: EUR/USD trading plan for the week of January 11-15. New COT report (Traders\’ commitments). Another slow bearish attempt will go back from 2.5-year highs.
Forex Traders Reviews Trading Plan
09.01.202114:22 Forex Trading Plan: EUR/USD Trading Plan for the week of January 11-15. New COT report (Traders’ ).
Last week, the EUR/USD again updated its 2.5-year highs and only started a new round of downward revision at the end of the week. In this, as before, this downward movement is very difficult to call a correction, and a pullback. Recall that the euro/dollar pair has been rising for 2 months without major adjustments and during this time managed to raise the price by 700 points, which is not so small for it. In this way, another slow withdrawal can end very quickly. Resumption of the upward trend. Unfortunately for logic and common sense, the euro/dollar pair continues to move as confusingly and irrationally as possible. This means that there seems to be a basic background, there are macroeconomic reports, but the pair is traded exactly the opposite because it should be traded. Thus, the rebound in price from the critical kijun-sen line may trigger a resumption of the upward trend.
In the last week of reporting (29 December – 4 January), the EUR/USD increased by 55 points. However, the reserve price is changing again, the euro/dollar pair has been steadily rising in recent weeks, but at the same time slowly. Despite the fact that the pair is growing or falling by no more than 100 points per week, the upward trend remains strong and stable. However, the changes presented in the latest COT report are also minimal. During the week, a group of “non-commercial” traders opened 2,000 purchase orders and 3,000 sales orders. Thus, formally the net position decreased, and the mood of professional entrepreneurs became more bearish. However, this is only formally because the total number of contracts opened by non-profit entrepreneurs exceeds 340,000. So opening/closing 2-3,000 contracts is nothing, a drop in the sea. Moreover, the strengthening of sentiment also means little, as COT reports signal demand for the euro. They do not take into account the demand for the US dollar. So a few months ago, when the net position continued to decline (as can be seen in the second indicator), demand for the euro among large investors decreased. It is possible, however, that at the same time demand for the dollar was falling, so with the apparent decline in interest of large investors in the euro currency, it continued to rise. Bad Just a moment. Over the past few weeks, the changes to the COT reports have been such that no conclusions can be drawn. If previously the green and red lines of the first indicator converge or spread, now they are simply directed sideways, signaling that there are no changes.
The whole basic background of the past week concerned only the States. Nothing interesting has simply happened in the European Union, and Europeans themselves have watched events in the United States, and in Washington in particular, not without interest. It should be noted that when Donald Trump provoked an attack on Capitol Hill, and the last two Democratic senators took their seats in georgia, and it turned out that all the power in the country for the next four years would be concentrated in the hands of Democrats, the U.S. dollar continued to fall calmly. And it was logical, events are still important, not in favor of the dollar. Trump’s actions have been condemned by the world, killing at least four people. But because the dollar is basically still falling, it’s still very difficult to explain. We have repeatedly pointed out that the US economy looks stronger and more stable than the European economy. Therefore, in combination with the euro, the dollar should rise. However, investors (and especially large investors) have their say on this, so the US dollar continues to fall. The funniest and most paradoxical thing happened on Friday. On this day in the European Union, the unemployment rate reportedly fell to 8.3%, and reports on nonfarm payrolls and average unemployment wages were published in the United States. NonFarm Payrolls was in the first place, of course, and completely failed. Instead of the projected 70-100 000 new jobs created outside the agricultural sector, in fact this figure has decreased by 140 000 jobs. The unemployment rate remained unchanged and wages rose slightly more than expected. In general, however, the package of macroeconomic statistics from across the ocean can be called failure. That’s why the dollar rose 60 points on Friday. Curtain.
Trading plan for the week of January 11 – October 15:
1) The pair’s quotes have started another pullback from 2.5-year highs, but the upward trend continues. Despite the fact that COT reports and the background continue to signal a possible and very likely decline in the pair’s quotations and the unfoundedness of the current increase, the trend continues. “Technology” continues to signal an upward trend, so trading at the current time level is recommended.
2) In order to be able to sell EUR/USD, you must at least wait for the price to be set below the Kijun-sen line. But even then, there is no guarantee that the downward trend will begin. Recall that in recent weeks and even months of technical signals have arisen several times at the beginning of the downward trend and each time they turned out to be false. Thus, despite the high value of the euro, we recommend selling carefully, although they are very attractive now, and forever the euro currency will not be able to grow.
Price support and resistance (resistance/support) – levels that are targets when opening purchases or sales. Take Profit levels can be placed near them.
Ishimoku Ratios, Bollinger Bunds, MACD.
Support and resistance areas are areas from which the price has repeatedly rebounded.
Indicator 1 on COT charts is the net position size of each category of traders.
Indicator 2 on COT charts is the net position size of a non-commercial group. This market analysis is informative and is not a transaction guide.
Respect,Analyst: Stanislav Polyanskygk InstaForex © 2007-2021