The EUR USD pair fell during the session on Wednesday, and even managed to close below the 1.37 handle. However, it wasn’t necessarily a convincing move and it’s easy to tell that there is quite a bit of support below this area anyway. Because of this, I’m not overly impressed with this move, and believe that the market will continue to grind back and forth as traders try to figure out what to do. Personally, I believe that this market is essentially stuck between the 1.35 level and 1.38 level, and probably will remain so for the foreseeable future.
That being the case, I have not been trading this market but been using it as a tertiary indicator as to the strength of the Euro. I’ve been trading the Euro, I just of not been trading it against the US dollar. Because of this, I feel that the pair should continue to be one that short-term traders flock to, and anybody looking for some type of trend is going to be out of luck.
1.38
Looking at the longer-term charts, the 1.38 level suggests massive amounts of resistance, as there is a downtrend line from the overall larger channel. Because of this, I feel that although there could be a bit of a downtrend about to happen, although there is significant amounts of support below, in the form of noise quite frankly. I do not wish to risk any type of trading capital in this pair at the moment, but if we did manage to break down below the 1.35 handle, I would be aggressively short of the Euro.
Going forward, I fully expect to see this market as being very difficult to trade, and would not be to adverse to trade the short-term charts, which is something I rarely do. If I were to trade this pair, I would probably be focusing on the hourly charts, and not much higher than that until we break out of this consolidation that we seem to be attracted to during the last several months.
