EUR / USD. October 11. The trading system “Regression Channels”. Inflation may weaken the dollar in the short run.

4-hour timeframe


4-hour timeframe

Technical details:

The senior linear regression channel: direction – sideways.

The younger linear regression channel: direction – down.

Moving average (20; smoothed) – sideways.

CCI: 168.9320

The technical picture of the EUR / USD instrument has changed. The price has fixed above the moving average line, so the trend has changed to ascending. There were no important macroeconomic events yesterday during the day. However, the pair continues to be adjusted against the previous fall against the background of the absence of new factors supporting the dollar, as well as due to technical need. Thus, the upward movement may continue, which is still evidenced by the purple bars. Today, October 11, the calendar of macroeconomic events in the eurozone is again empty, and in the United States will report on inflation. According to experts, the consumer price index will slow to 2.4% in annual terms. A rather significant slowdown in inflation (from 2.7%) may put even more pressure on the US currency, which, among other things, is under pressure because of a possible further escalation of the trade conflict with China. Thus, the inflation report is the key event of the last but one trading day of the week. Also, do not lose sight of the situation with Brexit. To a greater extent, this issue concerns the UK, but the signing of a “deal” for the withdrawal of Britain from the EU can have a beneficial effect on the European currency.

Nearest support levels:

S1 – 1,1536

S2 – 1,1475

S3 – 1.1414

Nearest resistance levels:

R1 – 1.1597

R2 – 1.1658

R3 – 1.1719

Trading recommendations:

The EUR / USD currency pair has overcome the moving. Thus, it is now recommended to open long positions with the first goal of 1.1597. Particular attention should be paid to the report on inflation, during the publication of which a reversal or increase in the movement may occur.

Short positions will again become relevant only after the price is fixed back below the moving average with the first target of 1.1475. But for this, the dollar will need serious fundamental factors.

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

Explanations for illustrations:

The senior linear regression channel is the blue lines of the unidirectional movement.

The junior linear regression channel is the purple lines of unidirectional movement.

CCI – blue line in the indicator window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels – multi-colored horizontal stripes.

Heikin Ashi is an indicator that colors bars in blue or purple.

The material has been provided by InstaForex Company –