To open long positions on EUR/USD, you need:

Yesterday, I focused on the 1.1918 level. Let's take a look at the 5 minute chart and talk about what happened. Even though the data on the index of business sentiment from the ZEW institute for Germany and the eurozone came out much worse than economists' forecasts, the euro remained near the 1.1918 level and the whole emphasis was shifted to the fundamentals of the US consumer price index. The report turned out to be better than economists' forecasts and after the dollar slightly strengthened, euro bulls seized the initiative and rose above resistance at 1.1918. A reverse test from top to bottom created an entry point for long positions, which by the end of the day pushed EUR/USD to the high of 1.1953. We managed to surpass this level in today's Asian session and the pair's succeeding upward trend depends on it.

The euro will still be in demand as long as trading stays above support at 1.1953. Forming a false breakout at this level will result in creating an additional signal for you to open long positions, and the nearest target will be resistance at 1.1987, where I recommend taking profits. Eurozone industrial output data and a speech by European Central Bank President Christine Lagarde could help the euro rise above 1.1987. A test of this level from the bottom up will only strengthen the bulls' position, which will lead to a new high of 1.2047, where I recommend taking profits. In case the euro falls and it is not active in the support area of 1.1953: then I recommend holding back from long positions until the test of the larger area of 1.1920, where you can buy EUR/USD immediately on a rebound, counting on an upward correction of 20-25 points within the day. Moving averages, playing on the side of buyers, also pass there.

To open short positions on EUR/USD, you need:

The bears believed in themselves for a minute after we received a good report on US inflation, but their optimism was quickly dispelled after a breakthrough of resistance at 1.1918, which has now transformed into support at 1.1920. The bears' initial task for the first half of the day is to regain control of support at 1.1953. Consolidation and testing this level from the bottom up can create an entry point for short positions, which will increase the pressure on the pair and push it to a low like 1.1920. In case the pair surpasses this range, which may occur if we receive a weak report on industrial production in the eurozone, then the euro can be sold further, counting on returning to support at 1.1880, where I recommend taking profit. If the euro is in demand this morning, and Lagarde talks about more active actions to implement the EU Stabilization Fund, then it is best to postpone short positions until a new resistance at 1.1987 is renewed. You can also sell EUR/USD on a rebound from a large high of 1.2047, counting on a downward correction of 15-20 points within the day.

The indicators of long and short positions underwent a number of changes in the Commitment of Traders (COT) report for April 6, it revealed that the indicators of long and short positions significantly increased, which indicates that the bears are still in control of the market. Long positions continued to decline, which led to another drop in the positive delta. Last week we received a number of fundamental reports, but the International Monetary Fund's meeting grabbed more attention, at which a number of agreements were reached to extend 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, there was also a lot of talk about the bureaucratic delay in the implementation of the EU Recovery Fund, which limits the euro's growth potential in the near future. For this reason, the market remains on the side of the sellers of risky assets in the medium term, which may lead to forming a succeeding 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 could seriously affect the balance of power in the market in favor of dollar bulls. One can expect an improvement in the economic outlook for the eurozone only when restrictions are lifted and the service sector is restored. This can also return the medium-term trend of strengthening EUR/USD and push it to an upward trend.

The COT report indicated that long non-commercial positions declined from 194,764 to 192,230, while short non-commercial positions rose from 121,024 to 124,708. As a result, the total non-commercial net position continued to decline and reached 67,522 against 73,739 a week earlier. But the weekly closing price rose to 1.1816 against 1.1768 last week.

Indicator signals:

Moving averages

Trading is carried out above 30 and 50 moving averages, which indicates that the euro will continue to rise.

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

Bollinger Bands

Growth will be limited in the area of the upper border of the indicator 1.1985. In case the pair falls, support will be provided by the lower border at 1.1885.

Description of indicators

• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
• MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-commercial 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 short and long positions of non-commercial traders.