The EUR/USD pair continues to dance around the 1.14 level during the day on Monday, and should continue to do so today. The market doesn’t look like it’s ready to make much in the way of movement, and with little like headlines out there to move the markets, it’s likely that we will continue to see very little in the way of confidence in either direction. I think that eventually we will try to break above the 1.15 handle, and if we can do so it would be a longer-term “buy-and-hold” scenario. However, we need a reason to do that. Right now, we don’t have one so it’s likely that the markets will continue to grind overall, waiting for some type of clarity.
No matter what happens, I think were going to be range bound more than anything else. It appears that the 1.1375 level underneath should continue to be supportive, and the 1.1425 level above will be resistive. I think short-term traders are going to continue to like this market scenario, because it gives you the opportunity to go back and forth and collect profits rapidly. However, I do think that eventually the buyers take over. The impulsive move on Thursday should continue to be underpinning the market over the longer term, but right now it appears that we are simply trying to build up enough momentum for the next move. In the meantime, small positions and small-time frames are probably the way to trade this market.
Written by FX Empire