The EUR/USD pair has chop around during the session on Tuesday as we continue to hover just above the 1.16 level. The market has recently broken through the neckline of the head and shoulders on the daily chart, and that being the case it’s likely that the downward momentum should continue, with the measurement suggesting that we will go as low as the 1.13 level underneath. The market looks very likely to be a “seller rally” type of situation, with the 1.17 level above being massively resistive as it was the neckline. Overall, the market should continue to be very noisy, especially considering that the Federal Reserve is looking to raise interest rates while the European Central Bank looks more dovish after the recent announcements.
It is not until we break above the 1.17 level that I would be remotely interested in buying this pair, as I recognize that the bearish pressure should continue to be a mainstay in this market place. I think that eventually we get the buyers back into the market, near the 1.13 handle. The market is probably going to go higher eventually, as I still believe that the overall attitude of the market will be bullish, but currently we are readjusting expectations. Eventually, the Federal Reserve will probably disappoint, and it’s likely that will be the turn around. However, we are nowhere near that right now and I think that selling is the only thing you can do until we break above the 1.17 level, or test the 1.13 level and show signs of support. Overall, this is a market that will be noisy, but I think we will continue to have plenty of opportunities if you are patient enough. In the short term, I believe the sellers are in control.
Written by FX Empire