EUR/USD had a bullish session on Thursday as the ECB has now suggested it will buy unlimited amounts of bonds from troubled members. However, the pair didn’t exactly take off like so many others did. In fact, this seemed to be a bit of a relief rally from those that would suggest that the European Union was going to fall apart overnight.
The Non-Farm Payroll numbers come out later today, and the markets will certainly be volatile because of it. This pair looks supportive though, and although I don’t trust this pair at all, I cannot argue with the fact that it keeps rising. Nonetheless, I still think there are easier trades out there, and as such I have been rarely involved with this pair.
The market sold off in the start of the session, but has bounced enough in order to form a hammer. If this hammer gets broken to the downside however, it is a "hanging man" which is of course very bearish.
1.27
The 1.27 level looks very important to me, as it is just above the 50% Fibonacci retracement from the fall back in spring. Because of this, I am not ready to go along yet, as well as the fact that the Non-Farm Payroll numbers will certainly push this market around. I believe that the close of business on Friday will be very telling however, and as long as we are above 1.2750, I think that the doorway to the 1.30 level is open.
As for the downside, I think a break of the bottom of the Thursday session could be sold, and most certainly a break of the 1.2450 level should be sold. This would be a very bearish turn of events as it would show momentum completely shifting back towards the downside. Because of this, I feel that simply waiting to see how the markets react to the employment numbers is the only way to trade this market right now. There simply far too much noise and volatility out there in order to place a trade over the next 24 hours.
