It cannot be said that the EUR/USD pair was trading strangely on Monday - but in a rather predictable way, if all factors are taken into account. Let's start with the technical ones. On Friday, the pair rose 120 points, showing extraordinary volatility that has rarely been seen in recent months. Considering that at the same time the pound sterling did not show anything of the kind, we conclude that the reason for such a strong growth in the euro lay not in the omicron strain and general panic. Considering the fact that there was no other strong and important fundamental and macroeconomic background on Friday, it turns out that we watched how market participants fix profits on short positions, which led to a fairly strong upward movement. Thus, on Monday we saw a simple pullback against the strong move on Friday. Nevertheless, even a weak uptrend line managed to form. However, it can be overcome tomorrow by analogy with the descending channel for the pound / dollar.
The picture on the 5-minute timeframe was quite trivial on Monday. If by the 30-minute one we can say that the pair was correcting, that is, it was moving down, then on the 5-minute TF it is clearly seen that the quotes spent most of the day in the horizontal channel between the levels of 1.1259 and 1.1290, and the decline was observed only at night when most traders in our time zone were sleeping. Nevertheless, several trading signals were generated even in the flat. We marked them with rectangles in the chart above, although in fact more than three of them formed. There were at least five rebounds from the level of 1.1259 alone. However, these were the same type of bounces, which should not have led to the opening of five long positions. So, in order. The first rebound from the level of 1.1259 is a signal to buy and the pair's growth to the level of 1.1290. As a result, the profit on a long position is 12 points. A rebound from the level of 1.1290 was formed for several hours, but still formed, and after it the price dropped back to the level of 1.1259. Thus, this sell signal should have been worked out, and the profit on it was 13-15 points. Further, new long positions should have been opened, since several rebounds followed from the level of 1.1259, but this time the price could no longer start a new round of upward movement, so the last deal should have been closed manually in the late afternoon. The profit on it, most likely, amounted to 0 points.
How to trade on Tuesday:
The downward trend reversed on the 30-minute timeframe. So now the euro can continue rising for some time, but the movement is unlikely to be strong. However, as long as the upward trend line remains relevant, long positions remain appropriate. On the 5-minute timeframe, the key levels as of November 30 are 1.1192, 1.1231, 1.1259, 1.1290, 1.1321. Take-Profit, as before, is set at a distance of 30-40 points. Stop Loss - to breakeven when the price passes in the right direction by 15 points. At the 5M TF, the target can be the nearest level if it is not too close or too far away. If it is located - then you should act according to the situation or work according to Take-Profit. On Tuesday, we recommend that novice traders pay attention to the report on inflation in the European Union. It can cause a reaction from the market, and its actual value is unlikely to coincide with the forecast and the previous one. Janet Yellen and Jerome Powell will also give speeches tomorrow, which may slightly affect the mood of the markets.
