The EUR/USD currency pair traded on Thursday as we predicted the day before. That is, it is difficult to predict, and also very volatile. Recall that the calendars of events in the US and the EU were completely empty on Thursday, that is, traders had nothing to react to during the day. However, at the moment the pair has already passed about 180 points from the low to the high of the day. This is a lot for the euro. Does anyone doubt that the reasons lie in the plane of the Federal Reserve, which raised the rate by 0.75% last night? And even despite the fact that the movement should have been reversed (that is, the dollar should have grown, not the euro), we still believe that the reason for such a strong movement on Thursday was the outcome of the Fed meeting. We have already talked about the pair's illogical movement both last night and today. Firstly, the market does not always work out important events in the way it would be logical. Secondly, the euro has fallen very strongly (that is, the dollar has grown) during the last 5-6 trading days, so any increase in the Fed's rate could already have been a worked out by the market in advance. One way or another, we always warn that on the days of summing up the results of the meetings of the central banks, as well as on the days following them, the pair can be traded very volatile and difficult to predict.
The technical picture looks very bad on the 5-minute timeframe, as the price ignored almost all the levels that it met on its way. This is also one of the disadvantages of those days when the fundamental background is very strong. Today, the pair managed to slide down, and traded in a flat, and showed the strongest growth. Quotes "danced" around the level of 1.0400 during the European trading session. The problem is not in the level itself, but again in the fundamental background. The first two signals, which turned out to be false, should have been enough to no longer trade near this level. The next signal available for processing was formed when the price rebounded from the level of 1.0465. But this signal turned out to be false. It still managed to set Stop Loss to breakeven. The next signal was the only one that allowed traders to earn. The price overcame the level of 1.0465 and after that went up 80 points. That's how much newcomers could earn. Total: the loss is about 40 points on the first two transactions, while the profit is 80 points on the last transaction.
How to trade on Friday:
The pair began a powerful upward movement on the 30-minute timeframe, which was almost impossible to predict. However, the pair has taken a tangible step towards a new upward trend. There is no trend line or channel at the moment, as the movement has just begun. The most important events of the month have been left behind, so the pair's succeeding movements should be more calm. On the 5-minute TF, it is recommended to trade at the levels of 1.0465, 1.0532, 1.0564, 1.0607, 1.0636, 1.0663, 1.0697. When passing 15 points in the right direction, you should set Stop Loss to breakeven. The European Union will publish the final value of inflation for May. The first estimate is 8.1%. It is unlikely that the second assessment will be very different from the first. Meanwhile, Fed Chairman Jerome Powell will deliver a speech, which is always important, as well as an insignificant report on industrial production.
