The Euro fell during the week, reaching down to the 1.12 level which of course is massive support based upon action over the last several months. At this point, you should also keep in mind that the 61.8% Fibonacci retracement level sits right around that level, so it’s likely that Fibonacci traders will continue to look at this as a buying opportunity. Beyond that, there is a history of support and resistance at this level. With that in mind, market structure is something that we should be paying attention to at this level.
EUR USD Forecast Video 22.04.19
That being said it’s not that we can bounce from here, quite frankly it wouldn’t surprise me at all if we did. We are currently trading between the 1.12 level on the bottom and the 1.15 level on the top. The range has been fairly reliable but we are certainly starting to drift a little bit lower. Ultimately, the market breaking down below recent support could open the door to the 1.10 level and could flush in a whole new round of US dollar strength against many other currencies.
As we have drifted lower, it’s obvious that short-term traders continue to get involved and start shorting on signs of exhaustion after short-term rallies. However, this is a marketplace that has a lot of decisions to make, and therefore the next couple of weeks could be crucial. In general, this is a market that you are probably best to leave alone until we get an impulsive candle either to the upside or the down to start putting money to work.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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