Euro finding support as Americans come back to work

Silver markets pressing resistance
January 13, 2019
Kiwi rolling over against Yen
January 28, 2019
EUR/USD Forecast
The Euro initially fell during trading on Tuesday, but as the Americans came back to work after the Monday holiday, they respected the uptrend line that has been holding this market up for some time. In fact, it’s starting to look more and more like a “rounded bottom”, which is a bullish pattern but it’s also a very slow moving pattern. Because of this, if we can clear the top of the trading range from Monday, which is substantively the 1.14 handle, I do think that the Euro will continue to grind towards the 200 day EMA. That being the case, the traders looking to buy the Euro will have to be very patient at this point. I look at this as a low risk trading, simply because if we break down below the uptrend line, basically the 1.1310 level, then I think at that point you could have a bit of a break down and it kills the idea of the “rounded bottom.”

The Federal Reserve has stepped aside from its hawkish stance, and I think that will continue to help the Euro in general, but now we need the ECB to get out of the way. With the ECB having a press conference on Thursday, that might be the catalyst to start this market going much higher. We will have to wait and see, but I think in the next couple of days we will get a definitive answer. The reason I like buying this pair now is that even if it is a loss, it’s small and that’s the essence of trading. I think the upside is much more pronounced than the downside after this recent pullback, and quite frankly we have been seeing the buyers try to lift this market for several days.

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