The EUR/USD pair fell initially during the trading day on Wednesday, but I cannot help but think that the market is telling us something. After all, the Greeks defaulted on their IMF payment, and as a result the markets should have been falling apart. However, they really didn’t. We are still below the uptrend line, and although we had a negative day, it wasn’t necessarily out of the ordinary. This tells me there is real resilience underneath the Euro right now, and I’m becoming more and more convinced that we are in the midst of a trend change.
The 1.10 level continues to offer support in my estimation, and I believe that it extends down to the 1.09 level. In other words, even if we break the uptrend line that I have on this chart, I’m not quite ready to start selling yet. I believe that the buyers will reenter this market, and the jobs number coming out of the United States could be the catalyst.
Nonfarm Payroll Numbers
Remember, today is employment number announcement out of the United States as the Independence Day holiday will get started during the day on Friday with most people being away from work. Because of this, it’s very likely that the announcement will be the main thing we focus on. Also, we have the Greek referendum over the weekend on Sunday, and that of course will have a lot to do with what this particular currency pair does. At this point though, it looks like there are people willing to bet on the Euro longer-term. So even if the referendum says that the Greek public isn’t willing to go along with the financial demands, I believe that we will find the bottom after that as well.
For me, it simply buying the Euro every time it is “on sale.” When you get to the bottom of the trend, quite often the change in the trend is very messy. The one looked at against historical trend changes, there’s really nothing out of the ordinary here.
