The Euro initially tried to rally during the trading session on Monday towards the 1.10 level, but then pulled back to show signs of resistance now. At this point, the market continues to favor the US dollar is Germany heads into recession and it’s very likely that the European Central Bank will continue to see a lot of need to liquefy the markets and of course ease monetary policy. That of course will work against the value of the Euro, and that by its very nature means that the US dollar should strengthen around the world.
EUR USD Forecast Video 03.03.19
The US Treasury market has been on fire lately, and that of course demand US dollars. With that, I think we continue to see this pair to drop from here, and I think that there is significant resistance extending all the way to at least the 1.1075 handle. To the downside, it’s very likely that we could grind our way down to the 1.05 handle, as it is the 100% Fibonacci retracement level, or at least close to it. That is my target but I also recognize is going to take quite a bit of time to get down there as this pair doesn’t typically move very quickly. It is by its very nature choppy, so keep that in mind.
Rallies at this point that break above the 1.11 handle would be worth looking at, but I would also need to see the momentum pick up rather rapidly. If we do, then we could start to talk about a reversal, but right now I just don’t see it.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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