EUR/USD Analysis on the 5-Minute Timeframe
The EUR/USD currency pair continued trading within a sideways channel on Monday, which has been in place for a month. It should be noted that the sideways movement began immediately after a two-month decline in the pair, the justification for which raises serious questions from an analytical perspective. Moreover, the month-long sideways movement, which has prevented the European currency from undergoing a normal correction, is also questionable. Essentially, the euro declined for two months and then simply stopped moving. This is not a currency belonging to a third-world country. It is, after all, at least the second most popular currency in the world. In our view, there were simply no sufficiently compelling reasons for such a sharp decline in the euro. The market continues to ignore rising inflation in Europe while readily pricing in higher US inflation. It also continues to overlook the ECB's monetary policy tightening while readily responding to an increase in the Federal Reserve's key interest rate. There were no significant events in the European Union or the United States on Monday, while geopolitical developments may have provided some limited support for the euro. Recently, an increasing number of reports have suggested that Iran and the United States may resume peace negotiations. In addition, trilateral talks between Russia, Ukraine, and the United States are scheduled to take place in Abu Dhabi today or tomorrow. Thus, two major global conflicts could potentially come to an end.
From a technical perspective, the downward trend may have ended, but the price remains within the sideways channel of 1.1115–1.1261. Therefore, the outlook for the European currency remains uncertain. A rebound from the upper boundary of the channel triggered a decline toward its lower boundary. However, no rebound from the lower boundary followed.
On the 5-minute timeframe, three buy signals were generated on Monday, all of which traders could have acted on. However, it should be remembered that the Ichimoku indicator lines are less reliable in sideways market conditions. Therefore, trading based on rebounds from the channel boundaries is currently preferable. Yesterday, long positions could only have been considered from the 1.1154–1.1165 level. This would have been sufficient to generate a profit by the end of the trading day.
COT Report
The latest COT report is dated November 3. The weekly chart clearly shows that the net position of non-commercial traders remains bearish and declined significantly in 2026 due to geopolitical developments. Over the past eight months, traders have been reducing their exposure to the European currency in favor of the US dollar. Donald Trump's policies have not changed, which is unlikely to support long-term dollar appreciation.
There are still no fundamental factors supporting further strengthening of the US currency. The war in the Middle East temporarily made the dollar exceptionally attractive, while the Federal Reserve's monetary policy stance provided another surprise in favor of the dollar for the second time this year. Over the long term, the euro could decline as far as 1.08 (the trendline), but the upward trend would still remain valid. However, in recent months, the market has been taking only positive factors for the dollar into account while ignoring all the others.
The positioning of the red and blue lines of the indicator points to a bearish advantage. During the latest reporting week, the number of long positions held by the Non-commercial group decreased by 1,300, while the number of short positions increased by 12,600. Accordingly, the net position declined by another 13,900 over the week.
EUR/USD Analysis on the 1-Hour Timeframe
On the hourly timeframe, EUR/USD has the potential to establish an upward trend, but it remains within a sideways channel for now. Looking at the daily and weekly timeframes, it becomes clear that the chances of a strong and prolonged trend remain high. However, for the European currency to appreciate, it needs to attract buying interest. Over the past two months, the market has shown little appetite for buying the euro. As long as the price remains within the sideways range, trading rebounds from its boundaries remains a viable strategy.
For November 10, the following trading levels are identified: 1.1006, 1.1115, 1.1154–1.1165, 1.1261–1.1274, 1.1362–1.1368, 1.1461–1.1473, 1.1536–1.1542, 1.1585, and 1.1657–1.1665, as well as the Senkou Span B (1.1183) and Kijun-sen (1.1205) lines. The Ichimoku indicator lines may shift during the day, which should be taken into account when identifying trading signals. Traders should also remember to move the Stop Loss order to breakeven once the price has moved 15 points in the favorable direction. This helps protect against potential losses if the signal proves false.
On Tuesday, an important US inflation report will be released, while the economic calendar in the European Union contains no significant events. Therefore, the most notable market movements are expected during the second half of the day.
Summary of the Analysis
Traders may consider short positions with targets near the 1.1154–1.1165 level if the price rebounds from the 1.1261–1.1274 level. Following yesterday's break below the 1.1154–1.1165 level, the 1.1261–1.1274 level may be considered a target for long positions.
Explanations for the Illustrations
Support and resistance levels are shown as thick red lines. Price movements may end near these levels, but they are not sources of trading signals.
The Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred from the 4-hour timeframe to the hourly timeframe. They are considered strong technical levels.
Extreme levels are shown as thin red lines. These mark levels from which the price has previously rebounded and serve as sources of trading signals.
Yellow lines represent trendlines, trend channels, and other technical patterns.
Indicator 1 on the COT charts shows the size of the net position held by each trader category.
