Wave Analysis by InstaForex

Forex Analysis & Reviews: Trading Recommendations and Analysis for EUR/USD on November 17: EU Economy Lacks Attention

Analysis of EUR/USD 5M



The EUR/USD currency pair maintained its upward momentum from the last two weeks on Friday but failed to extend gains. Throughout the day, volatility was relatively low, yet prices still fluctuated in various directions. Overall, the macroeconomic backdrop on that day was highlighted by just one report: the Eurozone GDP for the third quarter. The EU economy grew by 0.2% quarter-on-quarter and by 1.4% year-on-year. However, the report was released as a second estimate, which is the least significant and least interesting to traders. As a result, there was no reaction to this report, and during the European trading session, the euro weakened. During the American trading session, it was announced that the government shutdown had officially ended, though it could resume in February of next year. The U.S. dollar initially fell by 40 pips, then rose by 40 pips, marking the end of the day's movements on the last trading day of the week. The hourly timeframe continues to show an upward trend, but there is no clear trend line due to the absence of a second distinct extreme. On the 5-minute timeframe, two trading signals were formed on Friday. First, the price bounced off the area of 1.1604–1.1615, and about an hour later, it worked within three pips of the area of 1.1657–1.1666 before bouncing off it. Thus, the first trading signal could be executed without doubt, while the second could not incur any losses.

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.

Analysis of EUR/USD 1H



On the hourly timeframe, the EUR/USD pair continues to form a new upward trend. The current rise in the euro does not align with the local macroeconomic backdrop and fundamentals, but it does align with the global picture. The price remains within the daily range of 1.1400–1.1830, so a rise to the 1.1800 level can be anticipated even in the context of a local trend. For November 17, we highlight the following levels for trading: 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 Kijun-sen (1.1599). The Ichimoku indicator lines may shift during the day, which should be considered when determining trading signals. Don't forget to set stop-loss orders to break even once the price moves in the desired direction by 15 pips. This will protect against potential losses in the event of a false signal. On Monday, no important or even interesting events/reports are scheduled in the Eurozone or the U.S. Thus, volatility is unlikely to rise significantly beyond the average of about 50 pips. Throughout the day, the pair is expected to trade mostly sideways. Trading Recommendations: On Monday, traders may open long positions if there is another bounce from the 1.1604–1.1615 area, targeting 1.1657–1.1666. Short positions will become relevant upon a bounce from the area of 1.1657–1.1666, targeting 1.1604–1.1615.

Analysis are provided by InstaForex.

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Forex Analysis & Reviews: Trading Recommendations and Analysis for EUR/USD on November 18: A Correction Can't Hurt

Analysis of EUR/USD 5M



On Monday, the EUR/USD currency pair saw a minor pullback. Over the past week and a half, the euro has been slowly but steadily rising, recovering from the unjustified decline of the previous one-and-a-half months. Therefore, a minor correction within the local upward trend would not be detrimental. However, it is essential to note that the concept of trend is quite conditional, even on the hourly timeframe. The daily chart continues to show a global flat that has persisted for three months. Thus, any internal movement is a correction against a correction against a correction. The ascending trend on the hourly timeframe remains intact, as the price continues to stay above the Senkou Span B line. There is no clear trend line at the moment, but one could be constructed from the current correction. The fundamental and macroeconomic backdrop was absent on Monday, which once again explains the market's low volatility. The most important macroeconomic data in the U.S. is still not being published, and all other reports for the week are not significant under the current circumstances. The market is focused on what decision the Fed will make in December. To answer this question, statistics on the labor market and unemployment are needed. On the 5-minute timeframe, we see that for most of Monday, the pair traded sideways between the Kijun-sen line and the 1.1615 level. During the American trading session, the price consolidated below the Kijun-sen line; however, was it worth opening trades with such low volatility and with the Senkou Span B line 30 pips below?

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. Analysis of EUR/USD 1H

On the hourly timeframe, the EUR/USD pair continues to form a new upward trend. The current growth of the euro does not align with the local macroeconomic backdrop and fundamentals, but does correspond with the global context. The price remains within the daily range of 1.1400–1.1830, suggesting that a rise in the euro towards 1.1800 can be expected even within this local trend. For November 18, we highlight the following significant levels for trading: 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 Kijun-sen (1.1610). The Ichimoku indicator lines may shift throughout the day, which should be taken into account when determining trading signals. Don't forget to set Stop Loss orders to break even once the price moves in the correct direction by 15 pips. This will safeguard against potential losses if the signal turns out to be false. On Tuesday, no significant or interesting events or reports are scheduled in the Eurozone or the U.S. Therefore, volatility is unlikely to rise significantly above the average of around 50 pips. Throughout the day, the pair may trade predominantly sideways. Trading Recommendations: On Tuesday, traders may open long positions if there is a consolidation above the 1.1604–1.1615 range, targeting 1.1657–1.1666. A bounce from the Senkou Span B line will also provide an opportunity for long positions. Short positions will become relevant if the price consolidates below the Senkou Span B line, with a target at 1.1534. 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.

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