FX: Trading Plans For GBP/USD And EUR/USD Prepared By InstaForex | PPI In The EU Hit 36.3%
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Relevance up to 10:00 2022-07-06 UTC+2 Company does not offer investment advice and the analysis performed does not guarantee results. The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
Details of the economic calendar from July 4
Yesterday was a holiday in the United States in celebration of Independence Day. Thus, banks, exchanges, funds, and companies are closed, which led to a decrease in trading volumes in the financial markets.
The EU producer price index was released, which reflected a stronger slowdown, falling from 37.2% to 36.3%, with a forecast of 36.9%. This means that inflation in Europe may turn out to be short-term.
In general, the indicators are not bad, thus the euro is strengthening.
Analysis of trading charts from July 4
The EURUSD currency pair managed to regroup the trading forces during a pullback, which resulted in the upward interest stopping at around the value of 1.0460. This move led to a stagnation with subsequent restoration of the volume of meek positions.
During the pullback from the support level of 1.2000, the GBPUSD currency pair returned to the limit of the previously passed value of 1.2155, where there was a reduction in the volume of long positions. In this case, the level of 1.2155 plays the role of resistance, which puts pressure on buyers, slowing down the pullback stage in the market.
Economic calendar for July 5
Data on the index of business activity in the service sector, as well as the composite index of business activity in Europe and the UK will be published today. It is worth considering that these are the final indicators, and only if they diverge will we see a reaction in the market.
Time targeting of publication of statistical data:
EU – 08:00 UTC
United Kingdom – 08:30 UTC
Trading plan for EUR/USD on July 5
Now there is a reverse move to the base of the medium-term downward trend—the area of the 1.0350 mark. In this situation, a trend prolongation signal will appear on the market only after the price is kept below the value of 1.0320 for at least a four-hour period. Otherwise, the market will rebound again.
Trading plan for GBP/USD on July 5
The dollar position is at the stage of recovery, which has already led to the price approaching the area of the psychological level 1.1950/1.2000/1.2050. The main signal of the continuation of the downward trend will occur when the price holds below 1.1950 in a four-hour period. Until then, the risk of a price rebound from the control level remains.
What is reflected in the trading charts?
A candlestick chart view is graphical rectangles of white and black light, with sticks on top and bottom. When analyzing each candle in detail, you will see its characteristics of a relative period: the opening price, closing price, and maximum and minimum prices.
Horizontal levels are price coordinates, relative to which a stop or a price reversal may occur. These levels are called support and resistance in the market.
Circles and rectangles are highlighted examples where the price of the story unfolded. This color selection indicates horizontal lines that may put pressure on the quote in the future.
The up/down arrows are the reference points of the possible price direction in the future.
