The EUR/USD has traded with high volatility during the 24 hours up to the middle of Wednesday's trading session. The high volatility occurred due to the rate starting a break out above the 1.1200 level and another test of the 1.1230, which was sharply reversed by a fundamental announcement.
Namely, the US President Donald Trump cancelled the plans to implement new tariffs, which sent the USD into a surge against other currencies.
In regards to the near term future, the rate was expected to decline, as it was about to face the resistance of the hourly simple moving averages.
Economic calendar
On Wednesday, there will be no notable data releases that might impact the EUR/USD.
On Thursday, the US Retail Sales are expected to cause a move at 12:30 GMT. Note that this release also will consist of two numbers.
The Core Retail Sales do not include auto sales. People buy cars on debt, paying the same amount of money each month and continue to buy the needed transportation no matter what. The elimination of auto sales improves retail sales as a measure of economic growth.
The data release since April has caused moves from 9 to 24.3 base points.
EUR/USD hourly chart's review
On Wednesday morning, the EUR/USD was located below the combined resistance of the weekly pivot point and 200-hour simple moving average at 1.1186.In general, the rate was more likely to decline than surge, as the resistance of the 55 and 100-hour SMAs was approaching the pair from above. The SMAs were located at 1.1194 and 1.1197 at 09:00 GMT.
On the other hand, in the case of a surge, the rate might test the cluster of resistance levels at 1.1200.
Hourly Chart
On the daily candle chart last week the rate had reached the combined resistance of the weekly R2 and the 55 and 100-day simple moving averages near 1.1230. By doing this the EUR/USD has removed some of the oversold pressure.
In addition, the daily simple moving averages are acting as a technical resistance. It explains, why the rate failed to pass the 1.1230 level despite making already five attempts.
Daily chart
On Monday, on the Swiss Foreign Exchange 74% of open EUR/USD position volume was in short positions.
By the middle of Tuesday, the sentiment had decreased to 73%, and on Wednesday the trend continued, as 72% of volume was short.
Since Tuesday, trader set up pending orders in 100-pip range around the pair were bearish, as 56% of all orders were set to sell and 44% were to buy.