EUR/USD Analysis on 5M

The EUR/USD currency pair continued its upward movement on Thursday, which has intensified. So what happened yesterday that caused the euro to accelerate its growth while the dollar declined? The answer is simple: the US shutdown has officially ended. Wait a minute! Shouldn't such an event provide support for the US currency? Yes, it should, if the dollar hadn't been rising for a month and a half for unknown reasons. Although we have often mentioned the reasons, they are purely technical. The daily timeframe is currently flat, with the price declining from the upper to the lower boundary. When the pair approached the lower line of the sideways channel 1.1400-1.1830, a logical reversal occurred, and growth began. Throughout this time, macroeconomics and fundamentals have had no impact on the pair's movement. The dollar rose during the Federal Reserve's easing and the shutdown.

From a technical perspective, an upward trend has formed on the hourly timeframe, which may continue up to the area of 1.1800-1.1830, i.e., the upper line of the flat. Thereafter, everything will depend on the market makers' plans. If the moment for a new phase of the global upward trend has arrived and the corresponding positions have been established, we will see continued growth well above the 1.1800 level.

On the 5-minute timeframe, the pair yesterday broke above the 1.1604-1.1615 area, opening the door to long positions. By the end of the day, the area of 1.1657-1.1666 was reached, where profits could be secured from the long positions.

COT Report

The latest COT report is dated September 23. Since then, no further COT reports have been published due to the U.S. "shutdown." In the illustration above, it is clear that the net position of non-commercial traders has long been "bullish," with bears struggling to gain the upper hand at the end of 2024 but quickly losing it. Since Trump took office for a second term as President of the U.S., the dollar has been falling. We cannot assert that the decline of the American currency will continue with 100% probability, but current world events suggest that this may be the case.

We still do not see any fundamental factors that would strengthen the euro, while there remain sufficient factors that would weaken the dollar. The global downtrend is still ongoing, but what difference does it make where the price moved in the last 17 years? Once Trump concludes his trade wars, the dollar may start to rise, but recent events indicate that the war will continue in one form or another for a long time yet.

The position of the red and blue lines of the indicator continues to indicate the preservation of a "bullish" trend. During the last reporting week, the number of long positions in the "Non-commercial" group decreased by 800, while the number of shorts increased by 2,600. Consequently, the net position decreased by 3,400 contracts over the week. However, this data is already outdated and holds no significance.

EUR/USD Analysis on 1H

On the hourly timeframe, the EUR/USD pair finally shows signs of an upward trend beginning. The Senkou Span B line has been breached, indicating a probable change to an upward trend. We believe that the main reason for the inadequate and illogical movements recently is the flat on the daily timeframe. This flat continues. As the price approached the lower boundary of the sideways channel, a growth toward the upper boundary of 1.1800 can be expected soon.

For November 14, we highlight the following trading levels: 1.1234, 1.1274, 1.1362, 1.1426, 1.1534, 1.1604-1.1615, 1.1657-1.1666, 1.1750-1.1760, 1.1846-1.1857, 1.1922, 1.1971-1.1988, as well as the Senkou Span B line (1.1569) and the Kijun-sen line (1.1593). The Ichimoku indicator lines may shift during the day, which should be considered when determining trading signals. Remember to set a stop-loss order to breakeven if the price moves in the right direction by 15 pips to safeguard against possible losses if the signal turns out to be false.

On Friday, a report on third-quarter GDP is scheduled for publication in the Eurozone. We cannot say that this is a very important report, and the market is currently ignoring all events, relying solely on technical factors.

Trading Recommendations:

On Friday, traders can expect continued growth. A rebound from the area of 1.1657-1.1666 will allow for short positions to be opened, targeting 1.1604-1.1615. Breaking the 1.1657-1.1666 area will open the way for new long positions targeting 1.1750.

Explanations for Illustrations:

• Support and resistance price levels are shown as thick red lines, near which the movement may end. They are not sources of trading signals.
• Kijun-sen and Senkou Span B lines are lines from the Ichimoku indicator transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.
• Extreme levels are thin red lines from which the price previously bounced. They are sources of trading signals.
• Yellow lines are trend lines, trend channels, and any other technical patterns.
• Indicator 1 on COT charts represents the size of each category of traders' net position.