EUR/USD: plan for the US session on January 31. The euro is marking time before the level of 1.1038 amid poor data on inflation

By | January 31, 2020
InstaForex
EUR/USD: plan for the US session on January 31. The euro is marking time before the level of 1

To open long positions on EURUSD, you need:

Buyers of the euro were disappointed by the weak report on inflation growth in the eurozone, which coincided with economists’ forecasts, but the report on the GDP rate was not as good as expected, which kept EUR/USD in the narrow price channel. From a technical point of view, nothing has changed either. Volatility is quite low, which plays on the side of euro buyers. The bulls still need a breakout and consolidation above the resistance of 1.1038, which will strengthen the momentum that is aimed at the level of 1.1060, where I recommend taking the profits. Good data on the US economy, in particular on the growth of spending and income of Americans, can lead to pressure on the euro. In the scenario of the pair’s decline in the second half of the day, the area of 1.1009 will provide support, but it is best to open long positions from there under the condition of a false breakout since a break in this range will lead to a reversal of the upward correction and return new sellers to the market. In this case, I recommend looking for EUR/USD purchases only after updating the lows around 1.0983 and 1.0964.

To open short positions on EURUSD, you need:

Sellers are not in a hurry to return to the market, but there is also no serious demand for the euro. Today, the task of the bears is to form a false breakout in the resistance area of 1.1038, and good data on the growth of incomes and expenses of Americans will push the euro to the support of 1.1009, on which the further direction of the market depends. Fixing below this range will increase the pressure on EUR/USD, which will open a direct road to the area of 1.0983 and 1.0964 levels, where I recommend fixing the profits. If the bullish scenario is implemented, then you can only count on short positions after breaking the resistance of 1.1038 from the maximum of 1.1060.

Indicator signals:

Moving Averages

Trading is just above the 30 and 50 moving averages, which keeps the chance of a euro recovery.

Bollinger Bands

Volatility is low, which does not give signals to enter the market based on the indicator.

analytics5e34161f35b07.png

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

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Performed by Ruben Watson,
Analytical expert
InstaForex Group © 2007-2020

Benefit from analysts’ recommendations right now

Top up trading account

Get a bonus from InstaForex

InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.