The bearish trend within the USD/EUR remains aggressive and speculators who insist on wagering against the downturn are likely not enjoying the results. Traders must remember to check their egos at the door when they are trading and acknowledge the markets do not always move according to plan. While many traders may have the perception the EUR/USD has been oversold, the actual forex market doesn’t care about speculators feelings, and often finds new ways to punish those who remain stubborn.
In early trading today the EUR/USD has busted through the 1.17000 juncture lower and is currently traversing near the 1.16950 ratio. Lows of around 1.166600 were tested early in the morning and intriguingly the EUR/USD remains below what many analysts thought was a support juncture pointed at as a safe place to assume a reversal higher could take place. The day is certainly not done and the EUR/USD could turn around and thrust its way above the 1.17000 with a capable stride, but for now this important ratio is actually a resistance mark in the short term.
Technically the EUR/USD has been losing rather consistent value since the last week in May when the forex pair was trading near the 1.22680 vicinity. Speculators who are Euro-centric may not understand the bearish cycle which is going against their sentiment, but the trend cannot be argued against. Yes, it can be wagered against, but until a significant momentum turnaround is established traders should ask if a long position makes sense.
Even short term traders will be wise to look at long term charts of the EUR/USD. Support levels near 1.16850 to 1.16800 should be monitored. There are no mid-term charts to look at which can give a real indication where support is going to prove stable in the short term. This morning’s run lower to even sharper depths is an indication where the market may actually intend on challenging. However in the short term, more realistic targets as take profit marks should be used by speculators looking for quick hitting trades.
The EUR/USD has produced a sea of volatility and its downward momentum has been strong. While some speculators may be tempted to continue to look for tantalizing signs of reversals higher, they should also be practicing their risk taking tactics cautiously, because the trend remains evidently bearish. Selling the EUR/USD on slight reversals higher may remain the most worthwhile wager for traders near term.
EUR/USD Short Term Outlook:
Current Resistance: 1.17100
Current Support: 1.16850
High Target: 1.17400
Low Target: 1.16600
