The EUR/USD did not decline, as forecast. Instead of declining, the currency exchange rate surged on Tuesday. By the middle of the day's GMT trading hours, the rate had broken the resistance of the 55 and 100-hour simple moving averages.
Moreover, the pair broke the upper trend line of the channel down pattern, which captures the rates decline since March 28.
Economic Calendar Analysis
As it occurred during the last week, due to the fundamental changes in the markets, Dukascopy Analytics suggests to note the scheduled macroeconomic events, but avoid using historical data for guidance.
Namely, the whole world changes the money supply by announcing monetary stimulus and government expense increases. In other words, the central banks are creating more money and giving it to governments to stop the effects of the coronavirus. In effect, each announcement causes a fall of the currency that it affects.
However, click on the link and take a look at the last reactions to various events in March. Even already ignored events like Producers Price Index and Consumer Price Index caused notable reactions above 20 pips. Previously, the release of these data sets did not cause an increase of exchange rate volatility.
EUR/USD hourly chart's review
On Tuesday, the EUR/USD passed the resistance of the 55 and 100-hour simple moving averages and broke the upper trend line of a channel down pattern. Moreover, it faced no resistance as high as 1.0906.In general, the rate was expected to surge to the simple weekly pivot point at the 1.0906 level. If this level gets broken, the pair should reach for the 200-hour SMA at the 1.0940 level.
On the other hand, the round level of the 1.0900 could provide psychological resistance and force the rate into trading sideways.
Hourly Chart
On the daily candle chart, the surge of Tuesday was a consolidation of the previous six consecutive trading session surge. The pair is retracing back up from the support of the February low level of 1.0780.
Daily chart
By the middle of Tuesday's GMT trading hours, 71% of open EUR/USD position volume on the Swiss Foreign Exchange was in short positions.
The sentiment had remained almost unchanged since March 20. Traders remained short despite the recovery of the EUR/USD that has been occurring since that day.
On Monday, it had shortly increased, as 74% of trader open position volume was in short positions.