06.11.202413:16 Forex Analysis & Reviews: EUR/USD: Trading Plan for the U.S. Session on November 6th (Morning Trade Analysis)

In my morning forecast, I focused on the 1.0723 level to decide on market entries. Let's examine the 5-minute chart to analyze what occurred. A decline and a false breakout at this level created a buying opportunity for the euro, leading to a correction of over 50 points. The technical outlook has been updated for the second half of the day.

For Long Positions on EUR/USD:

As expected, the euro continues to trade with high volatility after news of Donald Trump's victory in the U.S. presidential election. Buyers are striving to hold the pair above the 1.0720 support level. With no significant U.S. statistics expected later today, the pair will likely stay in the trading range of 1.0709 to 1.0793, where I plan to focus my actions. The midpoint of this range is near 1.0745.

If the euro declines, a false breakout at 1.0745 would provide an opportunity to increase long positions, aiming for a correction toward 1.0793. A breakout and retest of this range would confirm a buying opportunity, targeting 1.0825. The ultimate target will be the 1.0855 high, where profits will be realized.

If EUR/USD falls and buyers fail to appear near 1.0745, the euro risks revisiting the weekly low. In that case, I will wait for a false breakout at the 1.0709 support before entering long positions. Alternatively, I plan to buy on a rebound from 1.0689, targeting a 30-35 point upward correction within the day.

For Short Positions on EUR/USD:

Sellers will aim to defend the 1.0793 resistance formed earlier in the day. A false breakout at this level would offer a short-selling opportunity, targeting a decline toward the 1.0745 support. A breakout and consolidation below this range, followed by a retest from below, would create another selling opportunity, targeting the weekly low of 1.0709 and forming a new downtrend. The final target will be 1.0689, where profits will be taken.

If EUR/USD rises and sellers are absent at 1.0793, buyers may push for a small correction. In this scenario, I will delay selling until the next resistance at 1.0825. I will sell there after a failed breakout. Alternatively, I plan to sell on a rebound from 1.0855, targeting a 30-35 point downward correction.

The Commitments of Traders (COT) report for October 29 revealed a significant increase in short positions and a smaller rise in long positions. It is important to note that this data does not reflect recent U.S. labor market statistics or the impact of post-election sentiment. Additionally, with this week's Federal Reserve meeting expected to result in a rate cut, the report holds limited relevance.

According to the COT report, long non-commercial positions rose by 6,154 to 159,313, while short non-commercial positions surged by 27,934 to 209,617. As a result, the net short position widened by 543.

Indicator Signals:

Moving Averages:

Trading is below the 30- and 50-day moving averages, indicating further potential for a decline.

Note: The period and prices of moving averages are considered on the H1 hourly chart by the author and differ from the general definition of classic daily moving averages on the D1 chart.

Bollinger Bands:

In case of a decline, the lower boundary of the indicator at 1.0670 will act as support.

Indicator Descriptions:

• Moving Average (MA): Determines the current trend by smoothing volatility and noise.
  • Period: 50 (yellow on the chart)
  • Period: 30 (green on the chart)
• MACD (Moving Average Convergence/Divergence): Tracks convergence/divergence of moving averages.
  • Fast EMA: Period 12
  • Slow EMA: Period 26
  • SMA: Period 9
• Bollinger Bands: Indicates volatility and price action levels.
  • Period: 20
• Non-Commercial Traders: Speculators such as individual traders, hedge funds, and large institutions using the futures market for speculative purposes and meeting specific requirements.
• Long Non-Commercial Positions: The total long open position of non-commercial traders.
• Short Non-Commercial Positions: The total short open position of non-commercial traders.
• Net Non-Commercial Position: The difference between short and long positions of non-commercial traders.