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29.05.2019 05:30 PM
EUR/USD. May 29. Results of the day. Problems with Italy – a new reason for traders to get rid of the euro

4-hour timeframe

This image is no longer relevant

The amplitude of the last 5 days (high-low): 31p – 81p – 38p – 29p – 39p.

The average amplitude over the last 5 days: 44p (45p).

The third trading day of the week for the euro/dollar pair is no different from the previous two. No important macroeconomic data, no important reports from world leaders, the euro continues to depreciate against the US dollar. Thus, from a fundamental point of view, there is essentially nothing to analyze. No new details about the course of the trade war between China and the United States, no new threats about the introduction of duties on European imports from the American side. But the euro is still falling. What does this mean? About the same, about which we already wrote previously. Traders continue to look hard to the South, as there is no reason to expect an improvement in the economic situation in the eurozone. Moreover, Europe cannot solve the situation with the release of the UK. Though it is more a problem of the United Kingdom. The situation with the high national debt of Italy also has a negative impact on the reputation of the EU and its investment attractiveness, and Rome, meanwhile, could fall under a heavy fine for failure to fulfill obligations to Brussels. It is unlikely that the Italian side will like it, there may be new conflicts, refusal to pay a fine, and in the future even Itexit ("Italy Exit"). This is, of course, too radical an option, but the very fact that there are problems with Italy cannot be denied. Thus, the bears continue to get rid of the euro, the EUR/USD pair is again approaching the annual lows and this time can successfully overcome them, which, in turn, will open the way for the pair to further fall. Tomorrow, the US will release a preliminary GDP value for the first quarter, which can greatly affect all pairs in which there is a dollar. A high value of the indicator may cause additional demand for the US currency.

Trading recommendations:

The EUR/USD pair continues its downward movement and overcame the Kijun-Sen line. Thus, sell orders with targets at 1.1138 and 1.1102 are relevant now.

Long positions can be considered if traders manage to gain a foothold back above the Kijun-Sen line. In this case, the nearest targets for euro purchases will be the resistance levels of 1.1190 and 1.1244.

In addition to the technical picture should also take into account the fundamental data and the time of their release.

Explanation of illustration:

Ichimoku Indicator:

Tenkan-Sen – red line.

Kijun-Sen – blue line.

Senkou Span A – light brown dotted line.

Senkou Span B – light purple dotted line.

Chinkou Span – green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD Indicator:

A red line and a histogram with white bars in the indicator window.

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