Euro Continues to Attempt Stabilization

[ad_1]

It is not until we break above the 1.12 level that I would consider buying this market.

The Euro initially rallied during the trading session on Wednesday, but then pulled back a bit from the highs. We had a Federal Reserve meeting and announcement during the day, so it is not a huge surprise to see that things were a bit volatile. Ultimately, this is a market that still sees a lot of resistance above, so I think is probably only a matter of time before we start selling again.

Advertisement

The 1.11 level above is the beginning of significant resistance to the 1.12 level, and then of course we have the 50 Day EMA drifting down below it. Because of this, I think it is only a matter of time before we see the sellers come back into the picture. Any signs of exhaustion will more than likely be jumped upon, and I do believe we have further to go to the downside. After all, the German ZEW shows just how dire the attitude is in the European Union, as it came out at -39 instead of the expected +5. Business confidence falling like that is not a good sign.

There are concerns about inflation and of course the war in Ukraine, so it will continue to be a bit of a drag on the Euro in general. The market falling from here could open up the possibility of a move down to the 1.09 level, and then the 1.08 level. If we break down below the 1.08 level, the market could then go looking towards the 1.05 level. Regardless, we are most certainly in a downtrend and there is no reason to try to fight it.

I believe that simply being patient enough to find “cheap dollars” will be the way going forward, as there are a lot of concerns when it comes to the EU, and of course, there is a lot of space between the interest rates of the two currencies. The interest rate differential has a lot to do with how currency pairs move, and that of course is going to continue to be one of the biggest influences in this pair. Furthermore, we have a situation where the overall momentum of the market continues to see downward pressure anyway. In fact, it is not until we break above the 1.12 level that I would consider buying this market.

EUR/USD Chart

[ad_2]

Leave a Reply

Your email address will not be published. Required fields are marked *

Risk warning: Trading in Contracts for Difference (‘CFDs’) carries a high level of risk and can result in the loss of all your investment. As such, CFDs may not be appropriate for all investors. You should not invest money that you cannot afford to lose. Before deciding to trade, you should become aware of all the risks associated with CFD trading, and seek advice from an independent and suitably licensed financial advisor. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to CFDs or (b) any direct, indirect, special, consequential or incidental damages whatsoever. For more information about the risks associated with trading CFDs please find and read our ‘Product Disclosure’.


Please recognize that this website is the only official website, please do not enter other clone websites through Internet search or advertisements.


© 2011 - 2024 mgtinvesting.com. All Rights Reserved.

en_USEnglish