To open long positions on EURUSD, you need to:

In the first half of the day, nothing interesting happened that could attract attention. None of the levels I indicated were tested, and the volatility remained low, even if the data on the index of business sentiment from the ZEW Institute for Germany and the eurozone came out much worse than economists' forecasts. Now traders are waiting for the publication of important fundamental indicators on the US consumer price index, which can set the direction of the market for the second half of the day. The report should be much better or worse than economists' forecasts, as only in this case the EUR/USD pair will be able to choose from the side channel in which the pair has been stuck since April 7.

Given that no market changes occurred in the first half of the day, the strategy for the US session and the levels remain the same. A break and consolidation above the level of 1.1918 with a reverse test from top to bottom form a good signal to open long positions with the target of growth to the maximum of 1.1953, where I recommend fixing the profits. The next major resistance is seen around 1.1987. Growth to this range may occur even after the release of good data on inflation in the United States, as there were no people who were sorry to sell the euro even after the gloomy reports from the ZEW Institute. This suggests a possible new bullish trend. If the euro does not move up after the release of the consumer price index, it is best not to rush to buy: you need to wait for the decline of EUR/USD and the formation of a false breakdown in the support area of 1.1868, from where you can open long positions in the continuation of the trend. If there is no bull activity at this level: I recommend postponing long positions until the support test of 1.1828, from where you can buy the pair immediately for a rebound in the expectation of an upward correction of 20-25 points within the day.

To open short positions on EURUSD, you need to:

Bears need to think about how to defend the resistance of 1.1918, as their plans for a downward correction depend on this level. Only the formation of a false breakout in this range in the second half of the day forms a good signal to open short positions to return to the support area of 1.1868. For this level, a very serious struggle will begin, since it is already determining the further upward trend of the euro. A break in this area and a consolidation below with a reverse test from the bottom-up forms a good entry point into short positions to return EUR/USD to the minimum of 1.1828, where I recommend taking the profits. A longer-term target will be the support of 1.1797, however, it will be available provided that the market responds adequately and correctly to the released indicators on inflation in the United States. If there is no activity of sellers in the area of 1.1918, it is best to postpone short positions until the update of a larger maximum of 1.1953, from where you can open short positions immediately for a rebound in the expectation of a downward correction of 15-20 points within the day.

Let me remind you that in the COT report (Commitment of Traders) for April 6, the indicators of long and short positions have undergone several changes – short positions have grown strongly, which indicates that the market remains under the control of euro sellers. Long positions continued to decline, which led to another drop in the positive delta. Last week was filled with several fundamental statistics, however, more attention was drawn to the meeting of the International Monetary Fund, at which several agreements were reached on the extension of the debt deferral program until the end of this year and an initiative was created to support the poor countries most affected by the coronavirus. Last week, much was also said about the bureaucratic delay in the implementation of the EU recovery fund, which is still really limiting the upward potential of the euro in the near future. For this reason, in the medium term, the market remains on the side of sellers of risky assets, which may lead to further formation of a downward trend. Investors expect the United States to be the first to start raising interest rates, which makes the dollar more attractive. This week's inflation data may seriously affect the balance of power in the market in favor of dollar buyers. The first signs of the formation of a medium-term bullish trend will be possible only after the lifting of restrictions and the recovery of the eurozone services sector, which will strengthen the hope for an improvement in the economic outlook and return the EUR/USD upward trend. The COT report shows that long non-profit positions decreased from the level of 194,764 to the level of 192,230, while short non-profit positions increased from the level of 121,024 to the level of 124,708. As a result, the total non-profit net position again continued its decline and amounted to 67,522 against 73,739 a week earlier. But the weekly closing price rose to the level of 1.1816 against 1.1768 last week.

Signals of indicators:

Moving averages

Trading is conducted in the area of 30 and 50 daily moving averages, which indicates the uncertainty of the pair with the further direction.

Note: The period and prices of the moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

A break of the upper limit of the indicator in the area of 1.1918 will lead to a new wave of growth of the euro.

Description of indicators

• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
• MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-profit speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between the short and long positions of non-commercial traders.