downward movement

With the appearance of the Bearish 123 pattern followed by the appearance of deviations between the #USDX price movement and the osMA indicator on the daily chart, then the probability of the USD Index in the next few days to fall down is quite large where the 103.35 level will be the main target to aim for and if this level is successfully broken downward then #USDX has the potential to fall down to test the 102.53-102.03 area as long as there is no upward movement that exceeds the 104.67 level because if this level is broken then all the downward scenarios that have been described will become invalid and cancel automatically.    

The EUR/USD currency pair continued its downward movement on Monday. Not as strong as on Friday, but still a decline. Thus, the pair spent less than a day above the moving average line and now may drop to the last local minimum and continue its movement to the south. We have repeatedly mentioned that we expect a decline in the past two months. And in the last month (when the pair was already actively falling), we constantly repeated that the decline should continue.   There have been no grounds for the euro to rise in the past three months, during which it enjoyed active demand. Now it's time to "repay debts." The minimum target for the decline is 1.0500. On the 24-hour timeframe, the pair ended only one day out of the last 25, with a significant increase. It might have seemed that a new upward movement would begin, leading to a resumption of the upward trend, but last Friday and Monday show that such a conclusion is premature. The euro currency rose within the last upward trend by almost 1600 points, which implies a correction of at least 600–700 points. That is, to the range of 1.03–1.04.   And because there are no grounds for resuming the movement to the north, these targets look even more convincing. Thus, we expect the continuation of a calm decline. All the movements of the past months are very similar to consolidation - a type of movement when the pair does not have a clear trend but is not in a flat state either. Consolidation will continue until the first signs of readiness to soften monetary policy from the Fed or the ECB appear. In principle, everything written below is not "big news." Over the past few weeks, we have witnessed many speeches by ECB and Fed representatives. And if unexpected information came from anyone, it was from the members of the FOMC. Recall that the market fervently believed that the last planned increase in the key rate in the United States took place in May.       However, several Fed representatives immediately indicated that the rate could be raised again in June, and some stated that the regulator could now raise the rate once every two meetings. However, the rate will continue to rise, which the market did not anticipate. The situation with the ECB and its monetary policy is much simpler. Almost all monetary committee members insist on further tightening, so there is no doubt that the rate will increase by another 0.5% at the next two meetings. However, some analytical agencies and major banks believe that we will see the last rate hike in June, which raises doubts about a rate hike after August 2023.   If so, the ECB's rate will remain much lower than the Fed's rate, and in 2023, it will increase by approximately the same value. Thus, the euro currency loses the growth factor that could help it in the coming months. Bostjan Vasle stated last Friday that it is necessary to continue raising the rate to combat high inflation effectively. He also noted that core inflation needs to be higher. His colleague Gabriel Makhlouf confirmed that the ECB intends to continue tightening its monetary policy.     He also noted the high level of core inflation and that the end of the tightening cycle has yet to come. Mr. Makhlouf said the current picture is quite blurry, besides the confidence in two more rate hikes. It is worth adding that the market has long worked out the rate hikes mentioned above. We have already mentioned many times that after slowing down the pace of tightening to a minimum, we can expect three more 0.25% rate hikes.   Thus, two rate hikes in June and August are logical and expected. They could have been anticipated several months ago. Therefore, the current "hawkish" sentiment of the ECB representatives does not provide any support for the euro currency. In the 4-hour timeframe, the downward trend is visible. The oversold condition of the CCI indicator has been worked off, so now the pair can continue to decline with a calm mind.   The average volatility of the EUR/USD currency pair over the last five trading days as of June 6th is 81 points and is characterized as "average." Thus, we expect the pair to move between the levels of 1.0631 and 1.0793 on Tuesday. A reversal of the Heiken Ashi indicator back upwards will indicate a possible resumption of the upward movement.   Nearest support levels: S1 - 1.0681 S2 - 1.0620   Nearest resistance levels: R1 - 1.0742 R2 - 1.0803 R3 - 1.0864   Trading recommendations: The EUR/USD pair has dropped below the moving average line. It is advisable to stay in short positions with targets at 1.0681 and 1.0631 until the Heiken Ashi indicator reverses upward. Long positions will become relevant only after the price firmly reclaims above the moving average line, with targets at 1.0793 and 1.0803.   Explanations for the illustrations: Linear regression channels - help determine the current trend. If both channels point in the same direction, it indicates a strong trend. Moving average line (settings: 20.0, smoothed) - determines the short-term trend and direction for trading.   Murray levels - target levels for movements and corrections. Volatility levels (red lines) - the probable price channel the pair is expected to trade in the next 24 hours, based on current volatility indicators. CCI indicator - its entry into the oversold area (below -250) or overbought area (above +250) indicates an approaching trend reversal in the opposite direction.  

The market may move downward from the level of 1.2420 (closing of yesterday's daily candle) to 1.2387, the 61.8% pullback level (blue dotted line). In the case of testing this level, the price may move upward with the target of 1.2448, the 38.2% pullback level (red dotted line).     Comprehensive analysis: Indicator analysis - down; Fibonacci levels - down; Volumes - down; Candlestick analysis - down; Trend analysis - down; Weekly chart - down; Bollinger bands - down.     General conclusion: Today, the price may move downward from the level of 1.2420 (closing of yesterday's daily candle) to 1.2387, the 61.8% pullback level (blue dotted line). In the case of testing this level, the price may move upward with the target of 1.2448, the 38.2% pullback level (red dotted line). Alternatively, the price may move downward from the level of 1.2420 (closing of yesterday's daily candle) to 1.2362, the 76.4% pullback level (blue dotted line). In the case of testing this level, an upward movement is possible with the target of 1.2448, the 38.2% pullback level (red dotted line).    

Indicator analysis: Daily review of EUR/USD on June 7, 2023 Open trading account Open demo account Deposit money Money withdrawal Open trading account Open demo account. The market may move downward from the level of 1.0691 (closing of yesterday's daily candle) to the target at the 1.0648 support level (thick red line). Upon reaching this level, an upward movement is possible with the target of 1.0702, the 14.6% pullback level (red dotted line).     Comprehensive analysis: Indicator analysis - down; Fibonacci levels - down; Volumes - down; Candlestick analysis - down; Trend analysis - down; Bollinger bands - down; Weekly chart - down.   General conclusion: Today, the price may move downward from the level of 1.0691 (closing of yesterday's daily candle) to the target at the 1.0648 support level (thick red line). Upon reaching this level, an upward movement is possible with the target of 1.0702, the 14.6% pullback level (red dotted line). Alternatively, the price may move downward from the level of 1.0691 (closing of yesterday's daily candle) with the target of 1.0635, the lower fractal (red dotted line). Upon reaching this level, an upward movement is possible with the target of 1.0702, the 14.6% pullback level (red dotted line).  

1H chart of GBP/USD In the 1-hour time frame, the pair started an upward movement and just as quickly ended it. The market insists on buying the pound, which remains significantly overbought and unjustifiably high. However, take note that the market has the right to trade regardless of the fundamental and macroeconomic backdrop. For now, we will consider the strong correction that we've seen last week and expect a revival of the downward movement.   On June 7, trading levels are seen at 1.2269, 1.2349, 1.2429-1.2445, 1.2520, 1.2589, 1.2666, 1.2762. The Senkou Span B line (1.2395) and the Kijun-sen line (1.2455) lines may also generate signals when the price either breaks or bounces off them. A Stop Loss should be placed at the breakeven point when the price goes 20 pips in the right direction. Ichimoku indicator lines can move intraday, which should be taken into account when determining trading signals. There are also support and resistance which can be used for locking in profits. On Wednesday, there are no important events scheduled in either the UK or the US. Therefore, there will be no specific events to react to during the day, and volatility could be low again, and we can't expect trend-driven movements either.     Indicators on charts: Resistance/support - thick red lines, near which the trend may stop. They do not make trading signals. The Kijun-sen and Senkou Span B lines are the Ichimoku indicator lines moved to the hourly timeframe from the 4-hour timeframe. They are also strong lines. Extreme levels are thin red lines, from which the price used to bounce earlier. They can produce trading signals. Yellow lines are trend lines, trend channels, and other technical patterns. Indicator 1 on the COT chart is the size of the net position of each trader category. Indicator 2 on the COT chart is the size of the net position for the Non-commercial group of traders.  

GBP/USD extended its downward movement on Tuesday, but in general, it remains stable. After a three-day correction, the pair barely managed to test the critical line without surpassing it. Thus, the uptrend persists ahead of an important inflation report in the UK, the Bank of England's meeting, and two speeches by Jerome Powell in the US Congress.   It is evident that these events will impact market sentiment, but it is currently impossible to determine how exactly. We need to be prepared for any developments. We believe that in the medium term, the pound should fall rather than rise, but the market currently holds a different opinion. We do not see any signs of the upward trend coming to an end. There were several trading signals on Tuesday. Initially, the pair bounced off the level of 1.2762, providing a buy signal. Following this signal, the price moved up by about 26 pips, which was enough to set the stop-loss at breakeven. Subsequently, there was a consolidation below the level of 1.2762, after which the pair dropped to the critical line but failed to surpass it. Consequently, it was advisable to close the short position at that point. The profit amounted to approximately 20 pips. The last buy signal formed quite late, but it could have been attempted. It resulted in an additional profit of 10-20 pips. Since the volatility was relatively low, such a level of profit was acceptable.   COT report: According to the latest report, non-commercial traders closed 5,200 long positions and 4,500 short ones. The net position dropped by 700 but remained bullish. Over the past 9-10 months, the net position has been on the rise despite bearish sentiment. In fact, sentiment is now bullish, but it is a pure formality. The pound is bullish against the greenback in the medium term, but there have been hardly any reasons for that. We assume that a prolonged bear run may soon begin even though COT reports suggest a bullish continuation. However, we can hardly explain why the uptrend should go on. The pound has gained about 2,300 pips. Therefore, a bearish correction is now needed.   Otherwise, a bullish continuation would make no sense even despite the lack of support from fundamental factors. Overall, non-commercial traders hold 52,500 sell positions and 65,000 long ones. We do not see the pair extending growth in the long term. 1H chart of GBP/USD In the 1-hour chart, GBP/USD maintains a bullish bias, although it is correcting at the moment. The ascending trend line serves as a buy signal but I believe that further growth of the British currency is groundless. The pound sterling has been climbing for too long and downward corrections are short-lived (like in the last three days). Judging by the technical indicators, we have an uptrend. It is not advisable to sell the pair without proper signals. The market can sustain the trend even without a "fundamental" basis. On June 21, trading levels are seen at 1.2349, 1.2429-1.2445, 1.2520, 1.2589, 1.2666, 1.2762, 1.2863, 1.2981-1.2987. The Senkou Span B (1.2532) and Kijun-sen (1.2739) may also generate signals when the price either breaks or bounces off them. A Stop Loss should be placed at the breakeven point when the price goes 20 pips in the right direction. Ichimoku indicator lines can move intraday, which should be taken into account when determining trading signals. There are also support and resistance which can be used for locking in profits. On Wednesday, the UK has the most important inflation report, and in the US - Federal Reserve Chairman Jerome Powell's first address to the Congress. Thus, it could be an interesting and volatile day. We think that the fall is more likely, but the pair also maintains a bullish bias and the market can start buying the pound again on any background.  

For short positions on EUR/USD: Sellers capitulated, and today their hopes are dwindling. The divergent policies of the Fed and the ECB, as well as aggressive statements from European officials regarding further inflation fighting measures, maintain demand for the euro, which is used by the big players. The only thing the bears do is to protect the new resistance level at 1.0997. I will go short on this mark after a rise and a false breakout. It may give a sell signal, pushing EUR/USD to a major support level at 1.0956, formed yesterday.   A decline below this level as well as an upward retest could trigger a downward movement to 1.0911. A more distant target will be the 1.0862 level where I recommend locking in profits. If EUR/USD rises during the European session and bears fail to protect 1.0997, the bullish trend will continue. In this case, I would advise you to postpone short positions until a false breakout of the resistance level of 1.1029. You could sell EUR/USD at a bounce from 1.1029, keeping in mind a downward intraday correction of 30-35 pips.   COT report: According to the COT report (Commitment of Traders) for June 13, there was a drop in long and short positions. However, this report was released even before the Federal Reserve's decision on the interest rate. The regulator decided to skip a rate hike in June this year, which significantly affected market sentiment. For this reason, one should not pay too much attention to the report. Demand for the euro remains high as the ECB remains committed to aggressive tightening. The euro is likely to maintain a bullish bias. The best medium-term strategy is to go long on the decline. The COT report showed that long non-commercial positions decreased by 9,922 to 226,138, while short non-commercial positions fell by 3,323 to 74,316. At the end of the week, the total non-commercial net position dropped and amounted to 151 822 against 158 224. The weekly closing price increased and amounted to 1.0794 against 1.0702.  

The market may move upward from the level of 1.0905 (closing of yesterday's daily candle) to test 1.0986, the 76.4% pullback level (red dotted line). Upon testing this level, a downward movement is possible with the target of 1.0958, the 23.6% pullback level (yellow dotted line). In case of testing this level, the price may move up.   General conclusion:   Today, the price may move upward from the level of 1.0905 (closing of yesterday's daily candle) to test 1.0986, the 76.4% pullback level (red dotted line). Upon testing this level, a downward movement is possible with the target of 1.0958, the 23.6% pullback level (yellow dotted line). In case of testing this level, the price may move up. Alternatively, the price may move upward from the level of 1.0905 (closing of yesterday's daily candle) to test 1.0958, the 23.6% pullback level (yellow dotted line). Upon testing this level, a downward movement is possible with the target of 1.0930, the historical support level (blue dotted line).  

On Friday, the GBP/USD pair did not even try to extend its downward movement. Take note that there was an ascending trend line during the entire bearish correction period (already two weeks), and the British currency does not seem like it is going to fall anytime soon.   At the same time, a new descending trend line has formed on the hourly chart, causing the pair to be trapped between two trend lines. On Friday, the UK released its GDP report. If it did provoke a market reaction, it was minimal, as its value for the first quarter fully coincided with the forecasts. There were no significant reports in the US, and secondary data such as personal income and spending, as well as the Personal Consumption Expenditures Price Index with the Consumer Sentiment Index, were unlikely to add pressure on the dollar. Especially considering that the USD has started falling in the morning. Therefore, we tend to believe that the nature of the movements were more technical. It was almost impossible to predict the upward reversal in the morning. On the hourly chart, a new support area was formed at 1.2598-1.2605, from which the pair rebounded. Currently, it is located between the Senkou Span B and Kijun-sen lines, and has also tested the trend line. There's a high probability of a rebound and a new downtrend, but the movement is currently volatile. The only signal was formed at the beginning of the US session when the price broke through the Ichimoku indicator lines and the level of 1.2693. It was not the best signal, and traders could only gain 10 pips. But it's better than false signals or losses.     COT report: According to the latest report, non-commercial traders opened 2,800 long positions and closed 2,500 short ones. The net position increased by 5,300 in just a week and continues to grow. Over the past 9-10 months, the net position has been on the rise. We are approaching a point where the net position has grown too much to expect further growth. We assume that a prolonged bear run may soon begin, even though COT reports suggest a bullish continuation. It is becoming increasingly difficult to believe in it with each passing day. We can hardly explain why the uptrend should go on. However, there are currently no technical sell signals. The pound has gained about 2,500 pips. Therefore, a bearish correction is now needed. Otherwise, a bullish continuation would make no sense. Overall, non-commercial traders hold 52,300 sell positions and 104,400 long ones. Such a gap suggests the end of the uptrend. We do not see the pair extending growth in the long term.     1H chart of GBP/USD In the 1-hour chart, GBP/USD maintains a bullish bias, although it is correcting at the moment. The ascending trend line serves as a buy signal. However, we still believe that the British currency is overvalued and should fall in the medium term. The fundamental backdrop for the pound is getting weaker. The dollar also lacks a fundamental advantage but has already lost 2,500 pips over the past 10 months and requires a correction. On July 3, trading levels are seen at 1.2349, 1.2429-1.2445, 1.2520, 1.2598-1.2605, 1.2693, 1.2762, 1.2863, 1.2981-1.2987. The Senkou Span B (1.2737) and Kijun-sen (1.2674) may also generate signals when the price either breaks or bounces off them. A Stop Loss should be placed at the breakeven point when the price goes 20 pips in the right direction. Ichimoku indicator lines can move intraday, which should be taken into account when determining trading signals. There are also support and resistance which can be used for locking in profits. On Monday, manufacturing PMIs are scheduled for release in both the UK and the US. All the reports, except for the US ISM, will be released in the second estimate, which is unlikely to surprise traders. However, the ISM index may show an unexpected value and, accordingly, stir some market reaction.   Indicators on charts: Resistance/support - thick red lines, near which the trend may stop. They do not make trading signals.   The Kijun-sen and Senkou Span B lines are the Ichimoku indicator lines moved to the hourly timeframe from the 4-hour timeframe. They are also strong lines. Extreme levels are thin red lines, from which the price used to bounce earlier. They can produce trading signals. Yellow lines are trend lines, trend channels, and other technical patterns. Indicator 1 on the COT chart is the size of the net position of each trader category. Indicator 2 on the COT chart is the size of the net position for the Non-commercial group of traders.  

Trend analysis (Fig. 1). The GBP/USD currency pair may move downward from the level of 1.2693 (closing of Friday's daily candle) with the target at 1.2640, the 38.2% pullback level (blue dotted line). Upon reaching this level, an upward movement is possible with the target of 1.2688, the 38.2% pullback level (red dotted line). Fig. 1 (daily chart). Comprehensive analysis: Indicator analysis - down; Fibonacci levels - down; Volumes - down; Candlestick analysis - down; Trend analysis - down; Bollinger bands - up; Weekly chart - down.   General conclusion: Today, the price may move downward from the level of 1.2693 (closing of Friday's daily candle) with the target at 1.2640, the 38.2% pullback level (blue dotted line). Upon reaching this level, an upward movement is possible with the target of 1.2688, the 38.2% pullback level (red dotted line).   Alternatively, the price may move downward from the level of 1.2693 (closing of Friday's daily candle) with the target at 1.2627, the 14.6% pullback level (red dotted line). Upon reaching this level, an upward movement is possible with the target of 1.2688, the 38.2% pullback level (red dotted line).  

NZD/USD exhibits bearish momentum, as it remains below a major descending trend line.   The price may continue its downward movement towards the 1st support at 0.6114, which is an overlap support. The 2nd support at 0.6049 reinforces the bearish outlook with swing low support and a 78.60% Fibonacci Retracement. On the resistance side, the 1st resistance at 0.6189 poses a challenge as a swing high resistance. The 2nd resistance at 0.6239 further strengthens resistance with swing high characteristics and a 78.60% Fibonacci Retracement. These factors contribute to the overall bearish momentum of NZD/USD.  

EUR/USD chart shows a bearish trend with potential for further downward movement towards the 1st support at 1.0847. The 2nd support at 1.0789 aligns with Fibonacci confluence. Resistance levels at 1.0911 and 1.0995 act as overlaps, supported by Fibonacci confluence. A symmetrical triangle pattern suggests consolidation, with a breakout indicating bullish or bearish direction.  

Because the CCI indicator managed to break down its three main levels and is now stuck at level 0 which indicates a resistance on the daily chart of the main USD/CHF currency pair, as long as USD/CHF is not corrected upwards beyond the 0.8804 level then in the next few days the currency pair This currency will try to go down to test the 0.8551 level as its main target and if the momentum and volatility are sufficiently supportive then the 0.8458 area level will be the next target to go.  

Details of the Economic Calendar on August 21 Monday, as usual, was accompanied by an empty macroeconomic calendar. No significant statistical data were published in the European Union, United Kingdom, or United States.   EUR/USD trading plan for August 22 Stable maintenance of the price above the level of 1.0900 may have a positive effect on the euro rate. However, until we see a breach of the 1.0950 level, we cannot assert with absolute confidence that sellers have eased their pressure and that the correction movement will no longer resume in the market.     GBP/USD trading plan for August 22 In this situation, traders prefer a breakout strategy, as this approach can clearly indicate the subsequent direction of market prices. A decline will become relevant if the price consistently stays below the 1.2650 level. This condition could contribute to the continuation of a downward corrective movement. A rise assumes a gradual recovery of the pound sterling's value relative to the current corrective movement. A primary technical signal of potential growth may appear if the price holds above the 1.2800 mark.   What's on the charts The candlestick chart type is white and black graphic rectangles with lines above and below. With a detailed analysis of each individual candle, you can see its characteristics relative to a particular time frame: opening price, closing price, intraday high and low. Horizontal levels are price coordinates, relative to which a price may stop or reverse its trajectory. In the market, these levels are called support and resistance. Circles and rectangles are highlighted examples where the price reversed in history. This color highlighting indicates horizontal lines that may put pressure on the asset's price in the future. The up/down arrows are landmarks of the possible price direction in the future.

The EUR/USD currency pair continued its downward movement throughout Tuesday. Volatility remained relatively weak, and the decline was not too strong. Nevertheless, it is very stable and raises no questions. We have repeatedly mentioned in recent weeks that such a movement is expected from the European currency, even if it seems illogical at first glance. For example, on Monday and Tuesday, there were no significant events or publications to justify the continued decline of the European currency. Last week, we expected an upward correction, which has yet to materialize. However, this market situation is the most logical one after the euro either rose unjustifiably in the first half of the year or simply held at a very high level without a correction. We believe that this factor is crucial for the euro and the dollar right now.   Consider this: if the Federal Reserve has raised and is raising interest rates more aggressively than the ECB, why have we seen the euro currency rise over the past year? Assume that the market has already set prices for all rate increases in the United States. In that case, why weren't rate hikes in the European Union priced the same way? The European economy has been struggling for several quarters, while in the US, we have seen quarterly growth of 2-3%. Based on all these factors, we have constantly stated that it's time for the pair to move downward. Significantly and for the long term. We do not rule out the possibility that, by the end of the year, the euro currency will return to parity with the dollar. In the 24-hour timeframe, the pair has breached the important Fibonacci level of 38.2% (1.0609) and is now almost guaranteed to drop to the 5th level. Remember that we have long referred to level 1.05 as the target. However, the movement to the south may not end there. We fully consider the possibility of a drop to the next Fibonacci level of 23.6% (1.0200). Muller and de Cos are once again pushing the euro lower. There have been no significant macroeconomic publications in the past few days. Only today in the United States will the report on durable goods orders be published, which can be considered more or less significant. However, over the past few days and the entire last week, we have witnessed speeches by representatives of the ECB's monetary committee. Several times a day. In principle, it became clear last week that the ECB is on the home stretch and will raise rates at most one more time. As we have mentioned, in the case of the ECB or the Federal Reserve, such actions can be considered logical, as the central banks have raised (or will raise by the end of the year) rates to almost 6%. Further rate hikes would be risky for the economy. But the situation is different with the ECB. The rate is slightly above 4%, which is clearly insufficient to bring inflation back to the target level in the near future.     But we are not here to judge the ECB; we are merely stating a fact: the ECB's rate has increased too weakly compared to the Federal Reserve's rate, and the euro currency has risen for too long based on expectations of a strong tightening of monetary policy in the European Union. The European currency may continue to decline peacefully because a wave of disappointment has now covered the market. On Tuesday, Madis Muller from the ECB stated that he does not expect a new rate hike. De Cos and de Galhau, the heads of Spain's and France's central banks, as well as Vice President de Guindos, had previously made similar statements. In one way or another, all ECB representatives have indicated that further tightening will only be possible in the event of accelerated inflation. However, the market is not too satisfied with this formulation because everyone understands that the European Union will be battling high inflation for several years to come. Just like the United Kingdom, but at least with Britain, it can be said that the central bank has done everything it could.   The average volatility of the EUR/USD currency pair over the last 5 trading days as of September 27th is 65 points and is characterized as "average." Thus, we expect the pair to move between the levels of 1.0495 and 1.0625 on Wednesday. A reversal of the Heiken Ashi indicator upwards will indicate a new attempt to make a slight correction. The nearest support levels are: S1: 1.0498 Nearest resistance levels: R1 = 1.0620 R2: 1.0742 R3: 1.0864     Trading recommendations: The EUR/USD pair maintains a downtrend. Short positions can be held with targets at 1.0510 and 1.0495 until the price consolidates above the moving average. Long positions can be considered if the price consolidates above the moving average with a target of 1.0742. Explanations for the illustrations: Linear regression channels help determine the current trend. If both are pointing in the same direction, it means the trend is strong right now. The moving average line (settings 20.0, smoothed) determines the short-term trend and the direction in which trading should be conducted at the moment. Murray levels: target levels for movements and corrections. Volatility levels (red lines): the probable price channel in which the pair will move in the next day based on current volatility indicators. CCI indicator: its entry into the overbought region (above +250) or oversold region (below -250) indicates that a trend reversal in the opposite direction is approaching.