The Euro bounce slightly during the trading session on Monday, reaching towards the 50 day EMA early in the session. The 1.10 level has offered significant support, and therefore if the market was to break down below there, it’s likely that the market could go down to the 1.09 level. Rallies at this point are probably to be sold near the 1.11 level as well, as there is a significant amount of previous action in that general vicinity.
EUR USD Forecast Video 12.11.19
There is also a large “M pattern” based upon the last couple of weeks, bouncing towards the 200 day EMA before breaking back down again. At this point, the market is very likely to continue to drift much lower. At this point, the market continues to favor the US dollar over the European Union Euro, simply because there has been so much in the way of negativity coming out of the EU over the last several months. While the market could bounce slightly, it should end up being a nice selling opportunity. Remember, the Federal Reserve is on the sidelines, which is most certainly a lot more hawkish than the ECB, which is likely to continue monetary policy easing, as suggested as of late.
The downtrend is most certainly still in effect, and therefore it’s difficult to get bullish of this market as the 200 day EMA has been so reliable resistance right along with the overall downtrend in channel. This has been the case for almost 3 years, and should continue to be in the foreseeable future.
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This article was originally posted on FX Empire
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