Feb 02 2021 0
The USD index rebounded strongly in the first session of the week. This price action is indicating signs of a breakout from the long-term downtrend. However, the important resistance level, at 91, is not likely to be penetrated. This gives us some really interesting ideas for the trades today.
- 10 US Republican senators urged President Joe Biden to significantly reduce the $ 1.9 trillion bailout package to win bipartisan support as Democrats in Congress prepare step up this stimulus plan.
- Mr. Biden has responded by inviting Republican lawmakers to the White House this week for discussion, even as he continues to look for a major stimulus package. The senators said the meeting was scheduled for Monday afternoon, at 17:00 US time.
- European Union statistics office Eurostat has said that unemployment in the Eurozone stabilized at 8.3% in December, despite the lockdown continuing in the bloc's regions.
The price has not adjusted down to the 104.4 conversion zone as expected but continued to go up, but the round number 105 area has not been broken yet. With the current price action we continue to follow the uptrend with 2 strategies: Wait for a standard pullback to around 104.5 and buy on signal. Or, in case the price breaks down to 105 with strong enough force, buy orders can be considered. The next target is around the 105.7 zone.
The price has approached the lower boundary of the range area. New price actions are showing even greater bearish potential. Those with short orders can continue to maintain and narrow the Stop Loss to reduce risk. The decisive price zone for today is the 1.205 zone. If it is broken, new sell orders can be considered.
The price falls again when it approaches the upper boundary of the narrow range. The short-term uptrend line has also been broken, hinting at the possibility of a price drop to the lower boundary of the range. Let's sell when the price breaks down to 1.363. The initial target is zone 1.35.
The price does not break the short-term uptrend line to return to the zone 1.27, so the strategy of waiting around buying around this zone cannot be implemented. Instead, the price returned to retest the downtrend line earlier than expected. We keep our old strategy: wait to buy when the price completely breaks the 1.287 zone. In that case, the next resistance level would be around 1.295.
Downside momentum has stalled around the 0.76 price zone. The strategy of adding new sell orders has not been implemented yet. The remarkable point is that the doji candle set was formed on the daily frame. Combined with the bullish pin bar candle set formed a few days ago, the possibility of a bullish correction is growing. You need to be careful with the possibility that the price will go up, so you should narrow your Stop Loss or partially exit existing short orders to reduce your risk.