Higher, higher and higher. Further prospects for the EUR/USD pair.

Dear readers and traders of the international currency market, a new week has come, and with you again an eternal wanderer and stock analyst Andrew Green.

A new week begins, and it is worthwhile to look at what happened during the past one. For the most traded instrument of the ForEx, the pair EUR/USD, this were a very interesting and intense trades. Having started quite calm week with trading in the range 1.2220-1.2270, the single European currency broke through the resistance level at 1.2300 and received a very significant boost to growth. (Figure # 1)

And, under the influence of a number of fundamental factors, the pair continued the ascent to the maximum of 2014 and the price level of 1.2500. What so important happened:

• a statement by the US Treasury Secretary Steven Mnuchin about the US dollar’s weak position for the US economy in the current period of history.
• the ECB meeting with, to a greater extent, a neutral stance, which simply underscored the statements of the last meeting.
• ascending dynamics of the euro on the target market expectations in the region of 1.2500.

The pair showed an interesting rally. But what to expect next

Let’s recap a bit about the weekend.

• In the market of gossip and unconfirmed news, there is an information about the possibility of a March increase in the discount rate for federal funds in the United States.
• Positive rhetoric of Trump in Davos, focused on attracting foreign investment in the United States.

In general, the fundamental background for changing the current dynamics is insignificant. But the most interesting on the charts. And let’s go back to Figure # 1.

As you can see, in the medium term, we already see a strong resistance level in the zone of intersection of the day (red) ascending channel and the weekly (blue) descending channel. In addition, the psychological level of 1.2700, in combination with two trend lines, creates a very interesting zone for possible correctional movement on the daily channel. As the price approaches this zone, I recommend to from bearish positions on the pairs – to sell. But be careful, long positions on the sale should not be opened earlier and below the levels of 1.2650.

For the usual Intraday trading, let’s move on to the timeframe. (Figure 2).

There are interesting options for trading in different directions. Those who already follow my articles and recommendations, have noticed that I trade more often from reversals than from breakdowns. And this time I will do the same and recommend exactly corrective movements for earnings.

The first option is a downward correction from psychology 1.2500

• example of the transaction:
  SELL limit 1.2510, SL 2580, TP 1.2430

The second option is an upward continuation of the current dynamics, after correction from the resistance in the zone 1.22-1.2300.

Potentially a good support zone while maintaining upward sentiment. It is likely that this level will be reached at the Federal Open Market Committee (FOMC) this Wednesday at 31 Jan 19:00 UTC. Here we have several levels of possible entry.

Example of a transaction:

• conservative option:
  BUY limit 1.2210, SL 1.2160, TP 1.2290.
• aggressive option:
  BUY limit 1.2270, SL 1.2230, TP 1.2340.

The next week promises to be interesting!

If you have questions about choosing a trading mode for a short, medium or long period, then you can contact me for advice and write to support@esterholdings.com with a note for Andrew Green, as well as pick up one of our individual training courses where you will learn the basics of asset management and time management in stock trading. More detailed information on the contents of these training courses you can find on the company’s website.

Trade always, trade everywhere, trade without a doubt!

Andrew Green