EURUSD: pair to rise from the LB

On Tuesday the 7th of April, trading on the euro closed up. The EURUSD pair rose to 1.0925 in the US session on the back of a rise in stock indices, which sent the dollar the other way. Stocks got a boost from news that the spread of COVID-19 is showing potential signs of slowing down in the US and Europe.

New York Governor Andrew Cuomo announced that the last couple of days has seen the death rate of coronavirus patients stabilize. By the end of the day, US indices had erased all their gains.

Data from the CDC (Center for Disease Control) took its toll on markets as the agency reported a rise in the rate of infections and deaths in the US. It doesn’t mention dates.

Day’s news (GMT+3):

  • 15:15 Canada: housing starts (Mar).
  • 15:30 Canada: building permits (Feb).
  • 17:30 US: EIA crude oil stocks change (3 Apr).
  • 21:00 US: FOMC minutes.
Pic. 1

Current situation:

The growth to the 112th degree occurred exactly as expected.The pair rose without any pullbacks, stopping only at the U3 line (the upper boundary of the MA channel). From there, the pair corrected to the LB balance line.

The only really important event today is the FOMC minutes. From a technical perspective, the bulls have induced a reversal, and now they need to keep the rate above 1.0840. Futures on the S&P 500 have erased their gains, which pushed the euro down immediately to 1.0830.

At the time of writing, the euro is trading at 1.0848. Our forecast shows the pair recovering to 1.0926. This could push on as far as 1.0960. However, given that the stochastic isn’t ready for growth on the H4 timeframe, the pair could just as easily return to 1.0830 at any moment. We should see this growth occur during the US session.

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