The EUR/USD pair broke much higher during the day on Wednesday, as it certainly looks as if the Euro rally will continue going further. It’s a bit surprising to us, but quite frankly now that we are above the 100 day exponential moving average, it’s very likely that traders will take notice, especially longer-term ones that are attracted to these particular types of averages. With this, it’s very likely that we will see more and more buying pressure. Having said that though, it’s not that it’s going to be an easy move. In fact, we believe that there is a significant amount of resistance all the way to the 1.15 handle. Because of this, it is difficult to go along with this move, but the trend is most certainly seems to be changing.
When you look at the Euro overall, it is showing strength across the board. Economic numbers out of Europe have been better recently, and there have been signs of the Greeks capitulating a little bit when it comes to the debt talks. Because of this, the Euro may get a bit of a reprieve for the longer term as well. Buying pullbacks going forward is probably going to be the best way to play this market, simply because it is so noisy just above. However, when you look at the EUR/GBP pair, you can see that we broke above significant resistance. When you look at the EUR/JPY pair, the same can be said as well as breaking above the 200 day exponential moving average, something that long-term traders pay very serious attention to.
The EUR/CHF pair looks like it’s suddenly seen a bit of bullishness as well, so other words it seems as if the Euro itself is the favored currency right now. This was a very sudden and violent turn of events, but quite frankly we have gotten to the point where the Euro was being sold by almost everybody. With fact, there really wasn’t anybody left to sell, and I suppose a bounce at this point in time would have been expected.