The EUR/USD pair has been very choppy over the last couple of sessions, as we await the jobs numbers on Friday, as it will obviously have a major influence on where the currency markets move next. There are a lot of concerns about rising interest rates in America, and that has thrown the stock markets into a bit of turmoil, not to mention that we have a lot of concerns when it comes to the potential trade war between the United States and China. I believe that we will continue to see a lot of volatility based upon headlines, and the potential meltdown in the stock market.
Because of this, it’s probably best to look at this is a short-term back and forth type of market, using a range bound system to take advantage of the support and resistance. The 1.23 level seems to be a bit supportive, while the 1.2350 level seems to be resistance. If we can break above there, the market should continue to go higher, perhaps reaching towards the 1.2425 handle, and then eventually the 1.25 level after that. A breakdown below the 1.23 level significantly could send this market down to the 1.22 level, and perhaps the previous uptrend line underneath there. I think that the market should continue to go higher, but it may take a while to get that action in the marketplace. It might take something like the jobs number to get things moving next, or of course the potential headline from either China or the US. Expect risky conditions, so use a small position size.
Written by FX Empire