- The EUR/USD has initially fallen during the trading session on Friday, as the jobs number in the United States came out much higher than anticipated.
- By doing so, the market is likely to continue to worry about the Federal Reserve, but at this point, it looks as if the market is likely to continue to see a lot of noise more than anything else.
- The size of the candlestick tells you just tell negative things were initially, but then turned around.
The fact that we ended up forming a bit of a hammer suggests that the market is going to continue to see buyers on dips, and if we break above the top of the candlestick is likely that we could go to the 1.06 level. If we can break above the 1.06 level, then it is likely that we could go to the 1.08 level. On the other hand, if we were to turn around and break down below the bottom of the candlestick for the trading session on Friday, that could open up a move down to the 1.03 level, which is an area that has previously been supported. Anything below there could be rather negative, perhaps opening up the possibility of a move down to the parity level.
Noise and Confusion Ahead
Keep in mind that the Euro has to worry about the European Union and its lack of economic growth, right along with the lack of energy. But at the same time, we have the European Central Bank looking at the possibility of having to tighten monetary policy due to the inflation situation. Regardless, I think we are going to continue to see a lot of noisy behavior and a lot of confusion. This is a situation where we continue to see a lot of chops, and I think at this point the choppiness is probably going to be the main feature of this pair all the way.
Ultimately, we are on the precipice of making a big move in one direction or the other, and I think the next couple of weeks are going to be very tough, so the most important thing you can do now takes advantage of more of a range bound system, but perhaps with an eye to the upside between now and the end of the year.
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