Daily Forex Reports | by FX Empire | Tuesday, 08 September 2015 06:23 UTC
The EUR/USD pair initially fell on Monday, but found enough support near the 1.11 handle to turn things back around and form a bit of a hammer. As you can see on the chart, there is a yellow rectangle that I have placed in order to show where the support is. If we can break above the top of the range for the session on Monday, we feel that this market probably goes back to the 1.13 handle. However, don’t get too excited as there is quite a bit of volatility just waiting to happen in this market, and with that we are very hesitant to put any serious money to work. What frankly, this feels more or less like a scalper’s type of market, and therefore we are willing to take short-term trades only, and was smaller than usual position sizes.
We believe that a break above the 1.13 level should send this market looking for the 1.15 level though, and that it will more than likely happen given enough time. There will be a lot of confusion as to what the Federal Reserve is ready to do though, and that is probably one of the biggest drivers of why this market is so choppy at the moment. After all, the latest jobs number was in exactly thrilling, and the Federal Reserve hasn’t exactly been clear about what its intentions are. Yes, some of the members have suggested that a rate hike is coming, but the question is whether or not there’s going to be more than one. The odds are getting smaller and smaller that there will be, and as a result perhaps people are going to start looking at the EUR/USD pair differently as the US dollar has been overbought if we do not have some type of rate hike cycle starting. It may be essentially a “one and done” type of situation, and that of course doesn’t necessarily warrant a meltdown in the value of the Euro. Because of this, the market may be trying to readjust itself.
Forex Market Analysis
Subscribe to Newsletter