Traders, who were short prior to the US Federal Reserve rate announcement, most likely profited, as yesterday's 18:00 GMT candle has a big tail down to the 1.1080 level.
Afterwards the rate surged, as the US Dollar began to lose value due to the rate cut and speculators all around the world taking profit from their short positions. On Thursday morning, it appeared that the EUR/USD rate would soon reach the 1.1200 level.
Economic Calendar Analysis
On Friday, November 1, the US Employment data set will be in focus - the Average Hourly Earnings, the Non-Farm Employment Change and the Unemployment Rate data will be published at 12:30 GMT.
This event has caused moves from 14.5 to 48.0 pips since June 2019.
At the same day, the ISM Manufacturing PMI survey results will be published at 14:00 GMT. The PMI release has caused reactions from 12.7 to 37.2 base points since June of this year.
For more detailed information take a look at the 28.10.-01.11. Event Historical Reactions publication.
Read More: 28.10-01.11 Event Historical Reactions
EUR/USD hourly chart's review
On Thursday morning, the EUR/USD traded near the 1.1170 level. Meanwhile, it had no technical resistance as high as the 1.1200 level, where a 38.20% Fibonacci retracement level was located at. In addition, the 1.1200 is a psychological level that impacts the rate on its own.In general, the rate was expected to reach the 1.1200 level during the near future. Although, on its way there it would test the high level of October. Namely, the 1.1180 level could provide resistance.
On the other hand, the pair might consolidate the recent gains. In that scenario the pair could reach down to the support of the 1.1150 level.
Hourly Chart
On the daily candle chart, the rate broke the resistance of the 100-day simple moving average, which was keeping the rate down at the start of this week.
Meanwhile, the 200-day SMA was providing resistance at the 1.1200 level. In addition, at that level a 61.80% Fibonacci retracement level was located at.
Daily chart
Read More: Technical Analysis
Traders remain short
Since the middle of Wednesday's trading, 74% of open EUR/USD position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, pending trade orders were set to sell, as 67% of orders in the 100-pip range were to sell and 33% were to buy. Previously, the orders were 59% bullish.
Most likely, traders have reopened their short positions, as the currency rate surged. Namely, these short positions are highly likely set up to profit from a possible down retracement of the EUR/USD.