The Euro continues to show resiliency after breaking down during the trading session on Tuesday. We broke below the 50 day EMA but then turned around of form a relatively positive candle. We are above the 1.1250 level which looks to be supportive right now, so the fact that we have formed this type of candlestick lets me know that the buyers are still very much alive underneath. If that’s going to be the case then it’s very likely that we continue the overall consolidation.
EUR/USD Forecast Video 17.04.19
By doing so, we could go as high as 1.15 and still not changed anything. I don’t think we reach that high though, because we do have the 200 day EMA between here and there that will almost certainly cause some type of reaction. Ultimately, this is a continuation of what we have seen for some time and what I believe is a longer-term bottoming pattern. However, expect a lot of volatility and therefore it’s best to look at this is a longer-term play even though it’s not that very far in terms of distance. However, the Euro tens the chop around a lot so none of this should be a surprise.
To the downside I see the 1.1250 level as supportive, followed by the 1.12 handle. It’s not until we break down below the 1.1150 level that I would be concerned about the overall consolidation. Longer-term I do expect this market to break out to the upside as the Federal Reserve is softening its stance, and we are starting to see preliminary signs of positivity out of places like Germany.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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