In my morning forecast, I emphasized the importance of the 1.0539 level as a key point for making trading decisions. Let's examine the 5-minute chart to analyze what transpired. A decline to this level and the subsequent formation of a false breakout provided an opportunity for long positions, resulting in an intraday rise of over 40 points. Active defense of the 1.0580 resistance level led to an entry for short positions, with the pair subsequently declining by 20 points. The technical outlook for the second half of the day remains unchanged.

To Open Long Positions on EUR/USD:

While trading remains range-bound, buyers are actively working to sustain yesterday's upward correction. In the second half of the day, critical US retail sales and industrial production data will be released. If strong data does not trigger a significant euro sell-off, a new wave of growth could develop.

A false breakout near 1.0539, as previously analyzed, could offer an opportunity to establish long positions during the correction, opening the path toward 1.0580—a level that has yet to be breached. A breakout and subsequent retest of this range would confirm a valid entry point for buying, with a target of 1.0617. The furthest target is 1.0653, where I plan to take profit.

If EUR/USD declines and shows no activity around 1.0539 during the second half of the day, the euro may continue its downtrend. In such a case, I will consider long positions only after a false breakout near the next support at 1.0497, the monthly low. Alternatively, I will open long positions on a direct rebound from 1.0474, targeting an intraday correction of 30–35 points.

To Open Short Positions on EUR/USD:

If the pair rises, sellers will focus on defending the 1.0580 resistance. A false breakout at this level, combined with strong US data, would serve as a valid entry point for short positions, aiming for a decline toward the support at 1.0539, where moving averages currently favor the bulls. A breakout and consolidation below this range, followed by a retest from the bottom up, would provide another opportunity for short selling, targeting a move toward the new monthly low of 1.0497, which would further validate the bearish trend. The furthest target is 1.0474, where I plan to take profit.

If EUR/USD rises in the second half of the day following the data release and buyers disregard the reports and Federal Reserve statements, euro bulls could attempt a correction. In this scenario, I will delay selling until the next resistance at 1.0617. I will also sell there but only after an unsuccessful consolidation. I plan to open short positions on a rebound from 1.0653, targeting a downward correction of 30–35 points.

Commitment of Traders (COT):

The latest COT report for November 5 revealed a modest increase in long positions and a significant reduction in short positions. However, this data does not account for the results of the US presidential election or the Federal Reserve's interest rate cuts. Given recent events, pressure on risk assets is likely to persist, and the US dollar is expected to maintain strong demand.

• Non-commercial long positions increased by 587, reaching 159,900.
• Non-commercial short positions decreased by 28,064, totaling 181,553.
• The gap between long and short positions widened by 1,193 contracts.

Indicator Signals

Moving Averages:Trading is currently positioned just above the 30- and 50-day moving averages, indicating efforts to support euro growth.

Bollinger Bands:In case of a decline, the lower boundary of the indicator at 1.0500 will act as support.

Indicator Descriptions

• Moving Average (MA): Smoothens volatility to indicate current trends.
  • 50-period MA is shown in yellow.
  • 30-period MA is shown in green.
• MACD Indicator: Used for detecting overbought and oversold conditions.
  • Fast EMA: 12-period, Slow EMA: 26-period, SMA: 9-period.
• Bollinger Bands: Measures volatility with a 20-period setting.
• Non-commercial traders: Speculators, such as individual traders, hedge funds, and large institutions, who use the futures market for speculative purposes.
• Net non-commercial position: The difference between short and long positions among non-commercial traders.