Review of EUR/USD on September 12; The Market Is Tired of Selling the Dollar

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On Wednesday, the EUR/USD pair traded rather calmly despite the "super-important and super-resonant" U.S. inflation report. Over the weekend, we dubbed this report the "event of the week," but the reaction from some traders was quite surprising. In short, the dollar rose despite inflation dropping to 2.5% y/y.

Let's recall that all recent reports on U.S. inflation have led to one outcome—the dollar's decline. It reached the point of absurdity: the U.S. currency would fall even with minor deviations from forecasts or even with no deviations at all. Simply put, when inflation in the U.S. falls, so does the dollar. However, yesterday marked another significant moment that may signal the end of the dollar's two-year decline.

The market responded by buying the U.S. currency, even though inflation in the U.S. slowed to 2.5%. We've repeatedly mentioned that discussions about the Federal Reserve easing its monetary policy should begin once inflation nears the target level. This happened at the end of August, but here's the paradox—the market has been pricing in the Fed's easing for two years now, and there's a high probability that it's already fully priced in. Even if we don't talk about 2022 or 2023, the market has anticipated the Fed's maximum rate cuts this year. Naturally, it has been pricing these cuts in advance, as it tends to do. With inflation approaching the target and the Fed having all the reasons not just to lower rates once but to begin a full cycle of monetary policy easing, the market can no longer price in this factor—it's already been priced in.

Thus, we wouldn't be surprised if the dollar's decline ends here. It's worth mentioning once again that on the weekly time frame, all of the British currency's growth since September 25, 2022, has been a correction against a stronger phase of decline within the framework of a 16-year (!) downward trend. Therefore, if we take a long-term perspective, there are still no reasons to expect a prolonged and strong rise in the British currency. It's important to understand that the pound rose to the 1.32 mark purely due to the full pricing-in of the Fed's policy easing. The pound simply has no more bullish drivers left. There weren't any before either—the pound was rising simply because the dollar was falling.

Thus, we can draw a clear conclusion: expecting further growth of the British currency is illogical. We didn't anticipate the last phase of growth that brought the pair to the 1.32 level, but predicting the exact reversal of a medium-term trend is never precise to within a few days or a specific price level. So far, as before, the pound isn't in a hurry to move down, but it did fall yesterday on news that used to cause it to rise confidently. The price settling below the moving average line confirms good prospects for the dollar's recovery.

The average volatility of EUR/USD over the past five trading days as of September 12 is 56 pips, which is considered average. We expect the pair to move between the levels of 1.0959 and 1.1071 on Thursday. The upper linear regression channel points upward, but the global downward trend remains intact. The CCI indicator entered the overbought area three times, signaling a potential shift to a downtrend and indicating how the recent rise is illogical. However, for now, we only see a relatively mild correction.

Nearest Support Levels:

• S1 – 1.0986
• S2 – 1.0925
• S3 – 1.0864

Nearest Resistance Levels:

• R1 – 1.1047
• R2 – 1.1108
• R3 – 1.1169

Trading Recommendations:

The EUR/USD pair continues to move moderately to the south. In previous reviews, we mentioned that we only expect declines from the euro in the medium term, as any new rise would appear to be a mockery. There is a possibility that the market has already priced in all future rate cuts by the Fed. If so, the dollar no longer has any reason to fall. Short positions can be maintained if the price stays below the moving average, with targets at 1.0986 and 1.0925. Last week's macroeconomic data put significant pressure on the dollar, but we are not seeing a similar market reaction this week.

Explanations for Illustrations:

Linear Regression Channels: help determine the current trend. If both are directed in the same direction, it indicates a strong trend.

Moving Average Line (settings 20,0, smoothed): defines the short-term trend and the direction in which trading should be conducted.

Murray Levels: target levels for movements and corrections.

Volatility Levels (red lines): the probable price channel in which the pair will spend the next 24 hours, based on current volatility indicators.

CCI Indicator: Entering the oversold area (below -250) or the overbought area (above +250) indicates an impending trend reversal in the opposite direction.

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EUR/USD. The Dollar Strengthens Amid Slowing U.S. Inflation. What is Driving the Greenback's Optimism?

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The dollar reacted positively to the release of the Consumer Price Index despite its slowdown in U.S. inflation. On one hand, this reaction from the U.S. currency seems unusual, as the Federal Reserve is now almost certain to lower interest rates at its September meeting. However, on the other hand, the greenback's growth is justified, as the latest figures suggest that the Fed is unlikely to adopt an aggressive pace of monetary easing. This fact allowed dollar bulls to make their presence known across the market, including in the EUR/USD pair, where the dollar is approaching the lower boundary of the 1.10 level.

By the numbers

According to the data, the overall CPI increased by 0.2% in August m/m, the same as in the previous month. In annual terms, the index rose to 2.5%, the slowest growth rate since February 2021. The core CPI, which excludes food and energy prices, increased by 0.3% m/m (beating the 0.2% forecast, making it the only component of the report to exceed expectations). In annual terms, the core CPI rose by 3.2% in August, the same rate as in July.

The report's structure shows that energy prices in the U.S. fell by 4.0% y/y in August (in particular, gasoline fell by 10.3%). In July, this component had risen by 1.1%. Clothing prices increased by 0.3% (compared to 0.2% growth in the previous month). The pace of food price growth slowed to 2.1% (from 2.2% in July). Transportation services rose by 7.9% (compared to 8.8% in July). New car prices fell by 1.2% in August (-1% in July), and used cars dropped by 10.4% (-10.9% in the previous month).

Market Reaction

As mentioned earlier, traders interpreted this report in favor of the dollar despite the overall slowdown in inflation in August. For one simple reason: the market is confident that the Fed will lower the rate by 25 basis points next week, not by 50. The probability of a 25-point scenario is now estimated at 82%, while the chances of a 50-point cut have dropped to 18%.

The August Nonfarm Payrolls report last week tipped the scale in favor of a "moderately dovish " scenario. It became clear that the U.S. labor market is cooling, but not at the pace indicated in July. Therefore, there is no need to put out the fire with a 50-point rate cut.

And yet, certain doubts remained—if the CPI growth report had fallen significantly below expectations, the question of a 50-point cut would have resurfaced. As of today, it can be confidently said that the outcome of the September meeting is almost predetermined. However, there remains intrigue regarding the future pace (and scale) of monetary policy easing, but this question has now moved to the background.

Conclusions

So, the dollar has risen—does this mean it's time to sell EUR/USD? In my opinion, no. The dollar received situational support, and traders confirmed what they've long suspected, but this isn't enough for a sustained downward movement in EUR/USD.

Let's start with the fact that on Thursday (September 12), another significant macroeconomic indicator will be released—the Producer Price Index. According to preliminary forecasts, the overall PPI is expected to reach 2.0% y/y in August. The indicator consistently accelerated for five months (from February to June), but the growth rate slowed to 2.2% y/y in July. Most experts believe this trend will continue in August. The core PPI is following a similar path. After three months of growth (from April to June), it unexpectedly slowed in July to 2.4%. A further decline is expected in August—this time to 2.3%.

In addition, the European Central Bank will hold a meeting on Thursday. This, as they say, is a "challenging task." The market is almost certain that the central bank will lower interest rates by 25 basis points as a result of this meeting. However, at the same time, the ECB may take a very cautious stance regarding further policy easing. Experts believe the ECB will take the next step to reduce rates at the December meeting—provided that inflation in the Eurozone does not start accelerating. If Lagarde's rhetoric is cautious, EUR/USD buyers could regain at least part of their lost ground, pushing the pair back to the middle line of the Bollinger Bands indicator on the daily chart, i.e., around the 1.1090 level. If the ECB casts doubt on the necessity of further monetary policy easing this year (which is unlikely), EUR/USD could return to the 1.11 level.

Given the high degree of uncertainty, it's best to stay out of the market for now. The ECB's verdict could reshape the pair's fundamental outlook.

The material has been provided by InstaForex Company - www.instaforex.com #

Oil storm and political intrigue: What's happening to US markets?

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Markets react to presidential debate: stocks fall, dollar holds
US stock futures fell, the dollar held its ground and bond prices jumped after a tense US presidential debate in which Vice President Kamala Harris put Republican nominee Donald Trump on the defensive.
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EUR/USD. September 11. The market remains cautious ahead of the ECB meeting.

On Tuesday, the EUR/USD pair continued its decline towards the 127.2% corrective level at 1.0984. A rebound from this level could signal a reversal in favor of the euro. This could lead to a potential rise toward the resistance zone at 1.1070–1.1081. A rebound from this resistance zone could lead to a decline to the 1.0984 level. The new bearish trend remains intact.

The wave structure has become somewhat more complex, though it still raises no major concerns. The last completed downward wave did not break the low of the previous wave, and the last completed upward wave did not break the peak of the previous wave from August 26. Therefore, the bullish trend is currently canceled. If the current downward wave breaks the low from September 3 more decisively, it will further confirm the formation of a bearish trend.

The news background on Tuesday was very weak, but today and tomorrow, traders will not be able to complain about a lack of important data. Today, the U.S. Consumer Price Index for August will be released. While this is unlikely to affect the decision the FOMC will make next week, a more rapid decline in inflation is detrimental to the dollar. Tomorrow, the ECB meeting is expected, where a decision to cut the interest rate by another 0.25% is likely. Traders are already prepared for this decision, so it shouldn't come as a surprise. However, the speech by Christine Lagarde could adjust traders' expectations regarding further monetary policy easing. The more dovish her comments are, the higher the likelihood of a euro decline. But it's important to remember that next week is the Federal Reserve meeting.

On the 4-hour chart, the pair dropped to the 76.4% Fibonacci retracement level at 1.1013. There are some early signs of a new bearish trend on the 4-hour chart, but without strong news from the U.S., the dollar may struggle to continue its growth for an extended period. No emerging divergences are observed on any indicators today. A rebound from the 1.1013 level will favor the euro and lead to some growth towards the 1.1139 level.

Commitments of Traders (COT) Report:

In the latest reporting week, speculators closed 2,412 long positions and 9,592 short positions. According to the Commitments of Traders (COT) Report, the sentiment among the "Non-commercial" group turned bearish several months ago, but bulls still actively dominate. The total number of long positions held by speculators now stands at 215,000, while short positions total only 115,000.

I still believe that the situation will continue to favor the bears. I see no long-term reasons to buy the euro. It's also worth noting that the market has fully priced in a Fed rate cut in September. The potential for a substantial decline in the euro remains high. However, we shouldn't forget about technical analysis, which currently doesn't suggest a strong euro decline with certainty.

News calendar for the U.S. and the Eurozone:

* U.S. – Consumer Price Index (12:30 UTC).




On September 11, the economic calendar includes only one, but very important, event. The impact of the news background on trader sentiment will be strong, but mainly in the second half of the day.

Forecast for EUR/USD and trader recommendations:

Selling the pair was possible after a rebound from the 1.1139 level on the 4-hour chart, with a target of 1.1070–1.1081. It was also possible to sell the euro after a close below the 1.1070–1.1081 zone, targeting 1.0984. These trades remain valid and can be held. I wouldn't consider buying this week, but the U.S. inflation report could trigger bullish activity.

Fibonacci levels are drawn from 1.0917 to 1.0668 on the hourly chart and from 1.1139 to 1.0603 on the 4-hour chart.Pentru mai multe detalii, va invitam sa vizitati stirea originala.

GBP/USD. September 11th. The British Economy is Not Growing.

On the hourly chart, the GBP/USD pair continued its decline toward the 127.2% corrective level at 1.3054 on Tuesday. A rebound from this level gives traders hope for a reversal in favor of the pound and some growth toward the 161.8% Fibonacci level at 1.3259. However, I doubt the bulls can drive the pair back up to this level. Consolidation below 1.3054 will increase the likelihood of a further decline toward the 1.2931 level.

There are no questions regarding the wave structure. The last completed downward wave did not break the low of the previous wave, but the most recent upward wave also failed to break the previous peak at 1.3264. Therefore, we are now witnessing a downward trend reversal. The most recent, still incomplete, downward wave has broken the previous wave's low, further confirming the formation of a bearish trend.

The news background on Tuesday did not help the bulls much, and today it has been of no help at all. While yesterday's reports from the UK could be considered positive, as both unemployment fell and the number of unemployment claims was lower than expected, today's GDP showed no growth, and industrial production declined by 0.8%. Traders had anticipated 0.2% growth for GDP in July and a 0.3% increase in industrial production. In both cases, they were disappointed. However, even these figures demonstrate how little interest the market currently has in economic data, particularly from the UK. Yesterday, relatively good data pushed the pound up by just 30 pips, while today's poor data caused a drop of only 20 pips, showing how little the market reacts to UK data. Thus, the market clearly indicates that it is focused on the U.S. inflation report, the Federal Reserve meeting, and Jerome Powell's speech, rather than routine economic data from the UK.

On the 4-hour chart, the pair retraced to the 1.3044 level. A rebound from this level, combined with a bullish divergence on the CCI indicator, suggests the possibility of some growth for the pair, but I don't expect it to be significant. I anticipate more consolidation below the 1.3044 level, which will pave the way for further decline toward the next corrective level of 61.8% – 1.2745.

Commitments of Traders (COT) Report:

The sentiment among "Non-commercial" traders has become much more bullish over the past week. The number of long positions held by speculators increased by 8,610 units, while short contracts decreased by 9,537 units. The bulls still have a solid advantage. The gap between the number of long and short positions is 108,000: 160,000 long versus 52,000 short.

In my opinion, the pound still has the potential for a decline, but the COT reports currently suggest otherwise. Over the past three months, the number of long positions has risen from 102,000 to 160,000, while the number of short positions has decreased from 58,000 to 52,000. I believe that over time, professional players will start to reduce their long positions or increase short positions, as all possible factors for buying the British pound have already been priced in. However, this is merely speculation. Technical analysis suggests a likely decline in the near future, but a clear bullish trend remains for now.

News calendar for the U.S. and the UK:

* UK – GDP change for July (06-00 UTC).
* UK – Industrial production change (06-00 UTC).
* U.S. – Consumer Price Index (12-30 UTC).




On Wednesday, the economic calendar contains three important reports, two of which have already been released. The influence of the news background on market sentiment will be strong throughout the rest of the day.

Forecast for GBP/USD and trader recommendations:

Selling the pair was possible after the rebound from the 1.3258 level on the hourly chart, with a target of 1.3054. The target has been reached, as expected. New sales should be considered after a close below 1.3054 with a target of 1.2931. I wouldn't rush into buying, even if there is a rebound from the 1.3054 level.

Fibonacci levels are drawn from 1.2892 to 1.2298 on the hourly chart and from 1.4248 to 1.0404 on the 4-hour chart.Pentru mai multe detalii, va invitam sa vizitati stirea originala.

XAU/USD: gold to lose in value in US inflation stays flat or rises

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Today, all markets without exception are focused on the release of US inflation data, which will help market participants understand whether the Fed's rate cut on September 18 will be a one-time event or the start of a cycle of monetary easing. Currently, the market believes that the easing will be systemic, but everything could change if the decrease in inflation is minimal or, conversely, if inflation rises above the current 2.9% annual rate.
The dynamics of the precious metal will




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How to Trade the GBP/USD Pair on September 11? Simple Tips and Trade Analysis for Beginners

Analyzing Tuesday's Trades:



GBP/USD on 1H Chart



On Tuesday, the GBP/USD pair showed only one thing — a complete reluctance to trade. Unlike the euro, the British pound had some interesting reports at its disposal. However, as we warned, they almost did not impact market sentiment. The UK unemployment rate decreased by 0.1% y/y, as expected. Wage growth slowed down slightly more than anticipated, and the number of unemployed increased much less than the market expected. Thus, we can conclude that the UK reports were positive, but the market is now interested in only one thing — the Federal Reserve's monetary policy. As a result, we saw a slight strengthening of the British currency, which had no impact on the technical picture. The price couldn't even consolidate above the nearest level of 1.3107. Therefore, the downward trend persists, and the corrective decline continues.

GBP/USD on 5M Chart



In the 5-minute time frame on Tuesday, two sell signals were formed around the area of 1.3102-1.3107. These signals duplicated each other, so only one short position should have been opened. Subsequently, the price dropped toward the 1.3043 level but didn't fully reach it. However, novice traders had ample time and opportunities to close the trade at maximum profit.

How to Trade on Wednesday:



In the hourly time frame, GBP/USD has a good chance of resuming the global downtrend or at least seeing a significant correction. The British pound remains overbought, the dollar is undervalued, and the market is still much more inclined to sell dollars than to buy them. So far, the pound only shows a minor bearish correction. It is too early to speak of a full-fledged downtrend. The much-anticipated Fed meeting will take place next week, and after that, conclusions can be made regarding the medium-term direction of the dollar.

On Wednesday, the pair could move in any direction, as no one can know in advance what the U.S. inflation report will show or how the market will react to it.

The key levels to consider on the 5M time frame are 1.2605-1.2633, 1.2684-1.2693, 1.2748, 1.2791-1.2798, 1.2848-1.2860, 1.2913, 1.2980-1.2993, 1.3043, 1.3102-1.3107, 1.3145-1.3167, 1.3225, 1.3272, 1.3310. On Wednesday, the UK will release GDP reports for July in both monthly and three-month formats. There will also be an industrial production report. However, these data are unlikely to trigger a significant market reaction. In the U.S., the Consumer Price Index for August will be released.

Basic Rules of the Trading System:



1) The strength of a signal is determined by the time it takes for the signal to form (bounce or level breakthrough). The less time it took, the stronger the signal.

2) If two or more trades were opened around any level due to false signals, subsequent signals from that level should be ignored.

3) In a flat market, any currency pair can form multiple false signals or none at all. In any case, it's better to stop trading at the first signs of a flat market.

4) Trades should be opened between the start of the European session and midway through the U.S. session. After this period, all trades must be closed manually.

5) In the hourly time frame, trades based on MACD signals are only advisable amidst good volatility and a trend confirmed by a trendline or trend channel.

6) If two levels are too close to each other (5 to 20 pips), they should be considered a support or resistance area.

7) After moving 20 pips in the intended direction, the Stop Loss should be set to break even.

What's on the Charts:



Support and Resistance price levels: targets for opening long or short positions. You can place Take Profit levels around them.

Red lines: channels or trend lines that depict the current trend and indicate the preferred trading direction.

The MACD indicator (14,22,3): encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a source of signals.

Important speeches and reports (always noted in the news calendar) can profoundly influence the movement of a currency pair. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to avoid sharp price reversals against the prevailing movement.

For beginners, it's important to remember that not every trade will yield profit. Developing a clear strategy and effective money management is key to success in trading over the long term.Pentru mai multe detalii, va invitam sa vizitati stirea originala.

Trading Recommendations and Analysis for GBP/USD on September 11; Has the Pound Begun a Prolonged Decline?

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Analysis of GBP/USD 5M

The GBP/USD pair traded both up and down on Tuesday. In the first half of the day, the British currency rose, driven by positive macroeconomic data from the UK. In the second half of the day, the market returned to the general downward trend formed over the past two weeks. By the end of the day, the price reached the 1.3050 level, but it failed to break through it.

Yesterday, the UK released reports on wages, unemployment, and the number of unemployed. The first report showed a more significant slowdown than expected. The second aligned with forecasts, while the third significantly exceeded expectations. Thus, in general, this set of data can be considered positive for the pound, which is why it rose during the European trading session. However, the downward correction of the pound is still very weak. We still expect a continuation of the decline, but it may not start immediately. The market is still in the state of "sell the dollar at any convenient opportunity." In the U.S., such an opportunity may present itself if the Consumer Price Index shows a more significant slowdown than the market expects. This could trigger another round of speculation around the Federal Reserve's rate, which might be cut by 0.5% on September 18 or something like that. Therefore, the dollar remains in a very precarious position.

There was only one trading signal on Tuesday. In the middle of the U.S. trading session, the price bounced off the 1.3050 level, but it was quite late to enter the market. A long position could have been opened by setting a Stop Loss below the 1.3050 level, but today, the U.S. inflation report will be released, and the pair could move sharply in either direction.

COT report:

The COT reports for the British pound show that the sentiment of commercial traders has been subject to frequent changes in recent years. The red and blue lines, representing the net positions of commercial and non-commercial traders, constantly intersect and are mainly close to the zero mark. We also see that the last downward trend occurred when the red line was below zero. Therefore, a downturn could be expected around the level of 1.3154, but this assumption will need regular confirmation over time.

According to the latest report on the British pound, the non-commercial group opened 8,600 buy contracts and closed 9,500 short ones. This led to a significant increase in the net position of non-commercial traders by another 18,100 contracts over the week, and overall, it continues to grow.

The fundamental background still does not provide any grounds for long-term purchases of the pound sterling, and the currency has a real chance to resume the global downtrend. However, an ascending trend line formed in the weekly time frame. Therefore, a long-term decline in the pound is unlikely unless the price breaches this trend line. Despite almost everything, the pound continues to rise. Even when COT reports show that major players are selling the pound, it continues to increase.

Analysis of GBP/USD 1H

In the hourly time frame, GBP/USD continues to correct, but this correction could end at any moment. It may have ended since the price couldn't stay below the Senkou Span B line. This line itself has settled above the price. Most of the U.S. macroeconomic data last week was weak as usual, reducing the market's desire to buy the dollar. The pair continues to move sluggishly, but this could persist for quite some time.

For September 11, we highlight the following key levels: 1.2605-1.2620, 1.2691-1.2701, 1.2796-1.2816, 1.2863, 1.2981-1.2987, 1.3050, 1.3119, 1.3175, 1.3222, 1.3273, 1.3367. The Senkou Span B (1.3174) and Kijun-sen (1.3143) lines can also serve as sources of signals. Setting the Stop Loss to break even when the price moves in the intended direction by 20 pips is recommended. The Ichimoku indicator lines may shift during the day, which should be considered when determining trading signals.

On Wednesday, the UK is scheduled to release the monthly and three-month GDP reports and industrial production data. In terms of significance, these are similar to the reports from yesterday. They may provoke a local market reaction, but nothing more. In the U.S., the "event of the week" will be the August inflation report, directly influencing the Fed's decision on September 18.

Explanation of illustrations:

Support and resistance levels: Thick red lines near which the trend may end.

Kijun-sen and Senkou Span B lines: These Ichimoku indicator lines, transferred from the 4-hour timeframe to the hourly chart, are strong lines.

Extreme levels: Thin red lines from which the price previously bounced. These provide trading signals.

Yellow lines: Trend lines, trend channels, and other technical patterns.

Indicator 1 on COT charts: The net position size for each category of traders.

The material has been provided by InstaForex Company - www.instaforex.com #

Trading Recommendations and Analysis for EUR/USD on September 11; The Dollar Continues to Rise, Though Slowly

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Analysis of EUR/USD 5M

On Tuesday, the EUR/USD pair showed low volatility and little desire to move. The U.S. dollar made a very modest gain throughout the day, but its rise is a positive sign. The dollar is still finding it difficult to achieve any significant growth, so when it strengthens even without fundamental or macroeconomic support, it gives hope that the market may finally start trading more or less logically. On Monday, there were no important reports or events. The report on German inflation, with all due respect, wasn't considered crucial data. Inflation in Germany slowed to 1.9% in annual terms, as predicted and as indicated in the preliminary estimate. Therefore, there was no market reaction to this report.

Thus, the EUR/USD pair remains in a downward trend. This trend is likely to continue today, regardless of the U.S. inflation report. Even if the report is unfavorable for the dollar, the pair would need to rise by about 110 pips to overcome all the Ichimoku indicator lines and the trend line. Only in that case could we say that the current downtrend has been canceled. So, even if we see growth today, it is unlikely to affect the overall trend.

Not a single trading signal was formed yesterday. However, the day before, the price rebounded from the critical line, so the short position could have been closed on Monday evening, or one could wait for the nearest target level of 1.1006 to be reached. That said, it was not reached on Tuesday either. On Wednesday, the movement in the second half of the day could go in any direction.

COT report:

The latest COT report is dated September 3. The illustration above clearly shows that the net position of non-commercial traders has remained bullish for a long time. The bears' attempt to take over failed miserably. The net position of non-commercial traders (red line) declined in the second half of 2023 and the first of 2024, while commercial traders (blue line) grew. Currently, professional players are again increasing their long positions.

We also still do not see any fundamental factors supporting the strengthening of the euro. Technical analysis indicates that the price is in a consolidation phase—in other words, a flat. In the weekly time frame, it is clear that since December 2022, the pair has been trading between levels 1.0448 and 1.1274. In other words, we have moved from a seven-month flat into an 18-month one.

At the moment, the red and blue lines are slightly moving away from each other, which indicates that long positions on the euro are increasing. However, such changes cannot be the basis for long-term conclusions within a flat market. During the last reporting week, the number of long positions in the non-commercial group decreased by 2,400, while the number of short positions fell by 9,600. Accordingly, the net position increased by another 7,200. Yet, there is still potential for the euro to fall.

Analysis of EUR/USD 1H

In the hourly time frame, the EUR/USD pair finally has a real chance to end the baseless upward trend from eight months to two years. A new downtrend has formed, which is currently short-term. Since the Federal Reserve meeting is still a week away, the market could resume the relentless selling of the U.S. currency. However, at least some technical grounds exist to expect a decline in the pair for now. The price is below the Ichimoku indicator line, opening some prospects for the U.S. dollar.

For September 11, we highlight the following levels: 1.0658-1.0669, 1.0757, 1.0797, 1.0843, 1.0889, 1.0935, 1.1006, 1.1092, 1.1137, 1.1185, 1.1234, 1.1274, as well as the Senkou Span B (1.1114) and Kijun-sen (1.1085) lines. The Ichimoku indicator lines can move during the day, so this should be considered when identifying trading signals. Remember to set a Stop Loss to break even if the price has moved in the intended direction by 15 pips. This will protect you against potential losses if the signal turns out to be false.

On Wednesday, the U.S. inflation report for August will be released, and it's essentially the only report of the day. However, it could influence the pair's movement tomorrow and in the coming weeks. It might.

Explanation of illustrations:

Support and resistance levels: Thick red lines near which the trend may end.

Kijun-sen and Senkou Span B lines: These Ichimoku indicator lines, transferred from the 4-hour timeframe to the hourly chart, are strong lines.

Extreme levels: Thin red lines from which the price previously bounced. These provide trading signals.

Yellow lines: Trend lines, trend channels, and other technical patterns.

Indicator 1 on COT charts: The net position size for each category of traders

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How to Trade the GBP/USD Pair on September 10? Simple Tips and Trade Analysis for Beginners

Analyzing Monday's Trades:



GBP/USD on 1H Chart



The GBP/USD pair showed a downward movement on Monday, which could have been avoided. However, last week, the price overcame the ascending trend line, and the British pound remains extremely overbought. Therefore, considering all factors, the British currency should only fall—long and hard. Yet, the declines in the pair on Friday and Monday show at least some signs of the market's readiness to sell, not buy. And this has happened extremely rarely lately.

Several important reports will be published in the UK this week, but they are unlikely to impact the market sentiment dramatically. The only important report is US inflation, from which surprises can and should be expected. Recall that the market has reacted with massive dollar sell-offs several times if the actual inflation rate was even 0.1% below the forecast. It is clear that the Federal Reserve will begin monetary policy easing at the next meeting, but the market still allows for the possibility that this cut could be as much as 0.5%.

GBP/USD on 5M Chart



One trading signal was formed in the 5-minute time frame on Monday. During the European session, the price consolidated below the 1.3102-1.3107 area, after which it managed to move down by about 30-40 pips. It did not reach the nearest target level, but the downward movement may continue. Therefore, novice traders could open a short position yesterday, and it could be closed in the evening or wait for at least the 1.3043 level to be reached.

How to Trade on Tuesday:



In the hourly time frame, GBP/USD has a good chance of resuming the global downward trend or at least experiencing some decline. The British pound remains overbought, the dollar is undervalued, and the market is still much more inclined to sell dollars than to buy them. So far, the pound only shows a minor bearish correction. It is too early to speak of a full-fledged downtrend.

On Tuesday, the pair might move in any direction, but we will likely see a flat movement. Last week, there were no new reasons for the dollar to rise, although the greenback remains excessively oversold.

The key levels to consider on the 5M timeframe are 1.2605-1.2633, 1.2684-1.2693, 1.2748, 1.2791-1.2798, 1.2848-1.2860, 1.2913, 1.2980-1.2993, 1.3043, 1.3102-1.3107, 1.3145-1.3167, 1.3225, 1.3272, and 1.3310. On Tuesday, reports on unemployment, wages, and changes in the number of unemployed will be released in the UK. These data may only provoke a local market reaction.

Basic Rules of the Trading System:



1) The strength of a signal is determined by the time it takes for the signal to form (bounce or level breakthrough). The less time it took, the stronger the signal.

2) If two or more trades were opened around any level due to false signals, subsequent signals from that level should be ignored.

3) In a flat market, any currency pair can form multiple false signals or none at all. In any case, it's better to stop trading at the first signs of a flat market.

4) Trades should be opened between the start of the European session and midway through the U.S. session. After this period, all trades must be closed manually.

5) In the hourly time frame, trades based on MACD signals are only advisable amidst good volatility and a trend confirmed by a trendline or trend channel.

6) If two levels are too close to each other (5 to 20 pips), they should be considered a support or resistance area.

7) After moving 20 pips in the intended direction, the Stop Loss should be set to break even.

What's on the Charts:



Support and Resistance price levels: targets for opening long or short positions. You can place Take Profit levels around them.

Red lines: channels or trend lines that depict the current trend and indicate the preferred trading direction.

The MACD indicator (14,22,3): encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a source of signals.

Important speeches and reports (always noted in the news calendar) can profoundly influence the movement of a currency pair. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to avoid sharp price reversals against the prevailing movement.

For beginners, it's important to remember that not every trade will yield profit. Developing a clear strategy and effective money management is key to success in trading over the long term.Pentru mai multe detalii, va invitam sa vizitati stirea originala.