The EUR/USD currency pair tried to start an upward correction on Tuesday after a three-day fall, which looks more like a collapse. However, before hitting the first level on its way, the euro gave in and retreated from it. We are talking about the level of 1.0465. Thus, by the end of the day, the pair's quotes were again near local lows and near 20-year lows. Therefore, we can make an almost unambiguous conclusion - the downward trend continues and there is no reason to believe that it will end in the near future. There is still no trend line, since there are not even two points through which it could be formed - such a strong downward movement. There were no macroeconomic statistics on Tuesday as well as fundamental events. However, the results of the two-day Federal Reserve meeting will be announced on Wednesday, which may provoke a serious outburst of emotions in the currency market. Given how much the euro has fallen over the past few days, we are not even sure that the market will react with new long positions on the dollar. Even if the Fed raises rates by 0.75%. Thus, you should be as careful as possible with opening any transactions.
The technical picture looks pretty average on the 5-minute timeframe. Like the day before, the movement seemed to be quite good, but the pair behaved very strangely near the key levels, sometimes ignoring the levels, sometimes forming false signals around them. Thus, it was not possible to earn a lot on Tuesday. The first buy signal turned out to be false, as the pair settled above the 1.0465 level, but failed to continue its upward movement. Novice traders failed to even place a Stop Loss on a long position, and the deal closed at a loss when the price dropped below the level of 1.0465, forming a sell signal along the way. It also had to be worked out and it was already better than the previous one, but the price still did not reach the nearest target level of 1.0389 (the level of 1.0400 is a new level). The third and last sell signal turned out to be the strongest, but it was not worth working on it, since at that time two false signals had already been formed near this level. In general, traders could get a small profit only on the second transaction if they closed it manually.
How to trade on Wednesday:
The pair continues a fairly strong downward movement without a trend line on the 30-minute timeframe. Thus, short positions on the pair are currently relevant, but traders have very few reference points, since there are, in principle, very few levels at current price values. Recall that now the price is trading near its 20-year lows. On the 5-minute TF, it is recommended to trade at the levels of 1.0354, 1.0400, 1.0465, 1.0532, 1.0564. When passing 15 points in the right direction, you should set Stop Loss to breakeven. The European Union will publish a report on industrial production, and the US will release a report on retail sales. Naturally, both of these reports fade against the background of the event, which is scheduled for the evening, and which, perhaps, is already having a strong impact on the movement of the EUR/USD pair. We are talking about the US central bank meeting, its results and a press conference with Fed Chairman Jerome Powell.
