EUR/USD Forecast July 4, 2013, Technical Analysis

The EUR/USD pair fell during the balance of the session on Wednesday, but as you can see bounced enough to form a pretty nice looking hammer just and the 1.30 handle. This hammer of course does suggest that there is a certain amount of support in this area, and one would expect it to be there simply because of the large, round, psychologically significant number involved.

It should also be noted that the Americans are getting ready to celebrate Independence Day today, and as a result the markets will more than likely find themselves very illiquid, and that could’ve been part of what we ended up seeing during the day, as traders squared away positions.

The hammer suggests that we are going to get a bit of a bounce from here, perhaps to the 1.31 level in relatively short order, and possibly even to the 1.32 handle. Because of this, we feel that this market will more than likely be a short-term buy, but you do have to be concerned about the fact that there has been a lot of choppiness between here and 1.32 as there is so many different areas of contention.

This pair is very headline driven, and let us not forget the fact that the Friday session will feature nonfarm payroll numbers, and because of this we will expect to see this market been fairly quiet between here and there, and certainly that announcement will have a great effect on the trajectory of the next move.

This market will course be almost that a standstill during the American trading hours, so most of the action will be found in both Asia and Europe. By the time the Europeans find themselves going home at the end of the session, you can pretty much expect the market to sit still, and essentially do nothing. Because of this, we are actually staying out of this market, but we feel that this market could offer a decent opportunity after the nonfarm payroll number comes out. Until then, we are a bit cautious just simply because of where we are, and the fact that it has been such a grind it down to this level, adding to that of course is the illiquidity that will have a massive effect on this market.


EUR/USD Forecast July 4, 2013, Technical Analysis

Written by FX Empire