The EUR/USD pair fell during the session on Friday, but did bounce off of the 1.27 support level. The resulting candle is somewhat like a hammer, and does show some support in this general vicinity. However, we think that the headline risks over the next couple of weeks will more than likely make is a very short-term traders market. We suggest that a bounce could come from here, but 1.28 will more than likely cause some type of resistance as well.
With that being said, we think that the market will be very tight, and short-term charts should be used if you feel the absolute need to be in this market. Going forward, we will need to see some type of serious breakout, and we think that the Tuesday hammer below would be an excellent selling signal if we can get below it. As far as buying is concerned, we need to clear the 1.28 level handily on a daily close.
Written by FX Empire