The Euro has been struggling with the 1.06 level for quite some time, and that suggests that we will eventually pull back. The 50-day moving average is above the 1.06 level and is sloping down. At this point, the market will continue to see a lot of negativity, so we are likely to reach the 1.04 level. The 1.04 level is an area where we formed a “double bottom” recently, But at this point, it looks like we might try to break below that level and test that bottom again.
If the market breaks below the 1.04 level, I think it could lead to a lot of fresh selling, and the Euro could go all the way to 1.02, and eventually break even. Equality will be the main level, I think a lot of traders are looking forward to the Euro dropping to this level. By looking at this graph, it looks like even if we break higher, there is a little bit of room we can cut up.
throughIf the breakout above the 50-day moving average, it is possible that we will try to reach the level of 1.08. The 1.08 level is an important area where we’ve seen buying and selling lately, so I think we may continue to see a lot of selling pressure in that area, so I don’t think the Euro is going to break out of that area anytime soon. If we break above this level, it could change a lot of positions. However, I think it’s going to need a massive change in general, so in the end, I’m skeptical of the progress. I see the rallies as an opportunity to start selling again, as the EUR has to deal with a very strong USD, due to the Fed tightening monetary policy much faster than the ECB could dream of. For this reason, I continue to look at advances showing signs of exhaustion as signs of profit on a downtrend. I think the Euro will continue to be very volatile, but that is nothing new for this pair, as it tends to be very noisy.
The chart was generated by . platform TradingView